11.PHILIPPINE INTERNATIONAL TRADING CORPORATION vs.

COA302 SCRA
241

FACTS:

This is a petition for certiorari under Rule 64 of the 1997 Rules of Civil
Procedure to annul Decision No. 2447 dated July 27, 1992 of the Commission
on Audit (COA) denying Philippine International Trading Corporation's (PITC)
appeal from the disallowances made by the resident COA auditor on PITC's
car plan benefits; and Decision No. 98-048 dated January27, 1998 of the COA
denying PITC's motion for reconsideration. The PITC is a government-owned
and controlled corporation created under Presidential Decree (PD) No.
252 on July 21, 1973, primarily for the purpose of promoting and developing
Philippine trade in pursuance of national economic development. On October
19, 1988, the PITC Board of Directors approved a Car Plan Program for
qualified PITC officers. Under such car plan program, an eligible officer is
entitled to purchase a vehicle, fifty percent (50%) of the value of which shall
be shouldered by PITC while the remaining fifty percent (50%) will be
shouldered by the officer through salary deduction over a period of five (5)
years. Maximum value of the vehicle to be purchased ranges from Two
Hundred Thousand Pesos (P200,000.00) to Three Hundred and Fifty
Thousand Pesos (P350,000.00), depending on the position of the officer in
the corporation. In addition, PITC will reimburse the officer concerned fifty
percent (50%) of the annual car registration, insurance premiums and costs
of registration of the chattel mortgage over the car for a period of five (5)
years from the date the vehicle was purchased. The terms and conditions of
the car plan are embodied in a "Car Loan Agreement". Per PITC's car plan
guidelines, the purpose of the
plan is to provide financial assistance to qualified employees in purchasing th
eir owntransportation facilities in the performance of their work,
for representation, and personal use. The plan is envisioned to facilitate
greater mobility during official trips especially within Metro Manila or the
employee's principal place of assignment, without having to rely on PITC
vehicles, taxis or cars for hire.
 
On July 1, 1989, Republic Act No. 6758 (RA 6758), entitled "An Act
Prescribing a Revised Compensation and Position Classification System in the
Government and For Other Purposes", took effect. Section 12 of said law
provides for the consolidation
of allowances and additional compensation into standardized salary rates sav
e for certainadditional compensation such as representation and transportati
on allowances which wereexempted from consolidation into the standardized
rate. Said section likewise provides
thatother additional compensation being received by incumbents as by of Jul
y 1, 1989 notintegrated into the standardized salary rates shall continue to
be authorized. The legislature has similarly adhered to this policy of non-
diminution of pay when it provided for the
transition allowance under Section 17 of RA 6758 which reads: Sec. 17.
Salaries of Incumbents. — Incumbents of position presently receiving salaries 
and additionalcompensation/fringe benefits including those absorbed from
local government units and other emoluments the aggregate of which
exceeds the standardized salary rate as herein prescribed, shall continue to
receive such excess compensation, which shall be referred to as transition
allowance. The transition allowance shall be reduced by the amount
of salary adjustment that the incumbent shall receive in the future. Based on
the foregoing pronouncement, petitioner correctly pointed out that there was
no intention on the part of the legislature to revoke existing benefits being
enjoyed by incumbents of government positions at the time of the virtue
of Sections 12 and 17 thereof. There is no dispute that the PITC officials who
availed of the subject car plan benefits were incumbents of their positions as
of July 1, 1989. Thus, it waslegal and proper for them to continue enjoying
said benefits within the five year period from dateof purchase of the vehicle
allowed by their Car Loan Agreements with PITC.

ISSUE:
Whether or not the contention of COA is not valid.

HELD:
The repeal by Section 16 of RA 6758 of "all corporate charters that exempt
agencies from the coverage of the System" was clear and expressed
necessarily to achieve the purposes for which the law was enacted, that is,
the standardization of salaries of all employees in government owned and/or
controlled corporations to achieve "equal pay for substantially
equalwork". Henceforth, PITC should now be considered as covered by laws p
rescribing acompensation and position classification system in the
government including RA 6758. This is without prejudice, however, as
discussed above, to the non-diminution of pay of incumbents as of July 1,
1989 as provided in Sections 12 and 17 of said law. Wherefore, the Petition is
hereby GRANTED, the assailed Decisions of the Commission of Audit are set
aside. RA 6758 which is a law of general application cannot repeal
provisions of the Revised Charter of PITC and its amandatory laws expressly
exempting PITC from OCPC coverage being special laws. Our rules on
statutory construction provide that a special law cannot be repealed,
amended or altered by a subsequent general law by mere implication; that a
statute, general in character as to its terms and application, is not to be
construed as repealing a special or specific enactment, unless the legislative
purpose to do so is manifested; that if repeal of particular or specific law or
laws is intended, the proper step is to so express it
12. MANILA ELECTRIC COMPANY (MERALCO), Petitioner, vs. SPS. EDITO and
FELICIDAD CHUA, and JOSEFINA PAQUEO, Respondents. [G.R. NO. 160422]

FACTS:

The monthly electric bills of spouses Edito and Felicidad Chua (the Chuas)
from 11 June to 11 September 1996 ranged from P747.84 to P887.27 for 231
to 269 kilowatt hours of electricity consumed per month. They were
surprised when their electric bill for 11 September to 11 October 1996
(September 1996 bill) amounted to P4,906.87 for 1,297 kilowatt hours of
consumed electricity, which was approximately 553% higher than their
previous monthly bill. Their daughter went to MERALCO to question the bill
and paid the same under protest to avoid disconnection. MERALCO replaced
the old meter with a new one because the old meter’s terminal was missing,
its cover seal was broken and it had a broken sealing wire. Based on the new
meter, the Chuas’ electric bills from 11 October 1996 to 24 January 1997
ranged from P700.00 to P800.00 for an average usage of 227 to 254 kilowatt
hours of electricity. MERALCO then sent a demand letter to the Chuas
requiring them to pay its differential billing of P183,983.66. When the Chuas
refused to pay, MERALCO disconnected their electric supply. Later, MERALCO
sent the Chuas another letter demanding payment of the reduced differential
billing of P71,737.49. The Chuas filed a case for mandamus and damages
with prayer for preliminary mandatory injunction to compel MERALCO to
restore their electrical connection. The Regional Trial Court (RTC) issued the
injunctive writ and subsequently ruled in favor of the Chuas and awarded
them P300,000.00 as moral damages. The Court of Appeals (CA) affirmed the
RTC’s decision but reduced the moral damages to P100,000.00. MERALCO,
thus, brought the case to the Supreme Court for review.

MERALCO argued that it had the right to immediately disconnect the Chuas’
electric service pursuant to Section 4 of Republic Act No. 7832 (RA 7832). It
added that under said law, the person who is benefited by the unlawful use
of electricity is presumed to be the perpetrator of the meter-tampering;
hence, there was no need to

prove that the Chuas actually tampered with the meter. MERALCO explained
that the differential billing represented the monetary equivalent of the
electricity used by the Chuas but not registered by the meter. MERALCO
further argued that based on Section 9 of RA 7832, courts cannot issue writs
of injunction against any private electric utility exercising its right to
disconnect electric service unless the electric utility acted in bad faith or with
grave abuse of authority, which the Chuas supposedly failed to prove.
MERALCO contended that even assuming it had no right to disconnect the
electric service, the Chuas could not claim moral damages because they did
not sustain any, having sourced their electric supply from another electric
meter within the premises.

ISSUE(S): (1) Whether or not MERALCO validly disconnected the Chuas’

electric service; (2) Whether or not the

issuance of the injunctive writ was in order; (3) Whether or not the Chuas
should pay the differential billing; and

(4) Whether or not the Chuas were entitled to moral damages.

HELD: (YES/NO, and a short explanation)

RATIO:

(1) For its failure to comply with Sections 4 and 6 of RA 7832, MERALCO had
no authority to

immediately disconnect the Chuas’ electric service.

Under Section 4 of RA 7832, the discovery of a tampered, broken, or fake

seal on the meter shall only constitute prima facie evidence of illegal use of
electricity by the person who benefits from the illegal use if such discovery is
personally witnessed and attested to by an officer of the law or a duly
authorized representative of the Energy Regulatory Board (ERB). With such
prima facie evidence, MERALCO can immediately disconnect the electric
service of the consumer after due notice.

Section 1, Rule III of the Rules and Regulations Implementing RA 7832 (IRR)
defines an officer of the law as one “who, by direct supervision of law or by
election or by appointment by competent authority, is charged with the
maintenance of public order and the protection and security of life and
property, such as barangay captain, barangay chairman, barangay
councilman, barangay leader, officer or member of Barangay Community
Brigades, barangay policeman, PNP policeman, municipal councilor,
municipal mayor and provincial fiscal.”
The author of RA 7832 explained during the Senate deliberations that having
an authorized government representative would be prudent so that
MERALCO’s findings could be verified and substantiated if a case was filed
and the customer would deny such findings. Furthermore, the presence of
government agents go into the

essence of due process; MERALCO cannot be allowed to act virtually as

prosecutor and judge in imposing the penalty of disconnection due to alleged
meter tampering.

In this case, MERALCO failed to complywith the required presence of an

“officer of the law,” as shown by the testimony of MERALCO’s representative
who inspected the meter, and by his Meter/Socket Inspection Report.
MERALCO did not even allege in its submissions to the Court that an ERB
representative or an officer of the

law ever accompanied its representative during the inspection of the Chuas’
electric meter. While MERALCO averred in its Answer that an ERB
representative witnessed the testing of the Chua’s electric meter at the
MERALCO laboratory, it never identified such ERB representative. The results
of such laboratory testing was also not signed by an ERB representative or
any officer of the law.

For lack of any evidence showing that a government representative

personally witnessed and attested to the discovery of the Chuas’ tampered
electric meter, no supporting prima facie evidence can be invoked for the
immediate disconnection of the Chuas’ electric service pursuant to Section 4
of RA 7832.

The presence of the consumer during the MERALCO inspection cannot be a

substitute for the presence of the government representative. Thus, even if
the Chuas’ daughter acknowledged having witnessed MERALCO’s inspection
and signed the inspection report, her presence did not characterize the
discovered broken meter seal

as prima facie evidence of illegal use of electricity justifying immediate

disconnection. Accordingly, Section 1, Rule III of the IRR, insofar as it
provides that the discovery may, in the alternative, be witnessed by the
consumer concerned to constitute prima facie evidence illegal use of
electricity, is invalid for expanding the statutory requirements of RA 7832.

Under Section 6 of RA 7832, MERALCO is authorized to immediately

disconnect the electric service of its consumers without the need of a court
or administrative order when: (a) the consumer, or someone acting on his
behalf, is caught in flagrante delicto in any of the acts enumerated in Section
4 of RA 7832; or (b) when any of the circumstances so enumerated,
constituting prima facie evidence of illegal use of electricity, is discovered for
the second time.

To be caught in flagrante delicto, or in the very act of committing the crime,

necessarily implies positive identification by an eyewitness or eyewitnesses
to the act of tampering so that there is “direct evidence” of culpability, or
“that which proves the fact in dispute without the aid of any inference or
presumption.” In this

case, MERALCO presented no proof that it ever caught the Chuas, or anyone
acting on the Chuas’ behalf, in the act of tampering with their electric meter.
The Chuas could not have been caught in flagrante delicto since they were
the ones who reported the defect in their meter. The presence of a broken
cover seal, broken sealing wire, and a missing terminal seal, would not be
enough to declare the Chuas in flagrante delicto tampering with the electric
meter. In fact, the electric meter was in a concrete post outside of the Chuas’
perimeter fence – a location accessible to the public. MERALCO also did not
present evidence that it caught the Chuas committing

any of the acts constituting prima facie evidence of illegal use of electricity
for the second time.

(2) The issuance of the injunctive writ was proper.

Under Section 9 of RA 7832, no writ of injunction or restraining order shall be

issued by any court against any electric utility exercising the right and
authority to disconnect electric service, unless there is prima facie evidence
that the disconnection was made with evident bad faith or grave abuse of
authority.

Electricity is a basic necessity whose generation and distribution is imbued

with public interest, and its provider is a public utility subject to strict
regulation by the State in the exercise of police power. In view of MERALCO’s
dominance over its market and its customers and the latter’s relatively weak
bargaining position as against MERALCO, and in view too of the serious
consequences and hardships a customer stands to suffer upon service
disconnection, MERALCO’s failure to strictly observe the legal requirements
for instant disconnection can be equated to the bad faith or abuse of right
that the law speaks of.

MERALCO abused its superior and dominant position as well as the authority
granted to it by law as a service provider when it persisted in disconnecting
the Chuas’ electric service. Hence, the exception under Section 9 of RA
7832, which allows injunction to issue when disconnection is attended by bad
faith or grave abuse of authority, should apply.

An injunctive writ issues only upon a showing that: a) the applicant

possesses a clear and unmistakable right; b) there is a material and
substantial invasion of such right; and c) there is urgent and permanent
necessity for an injunctive writ to prevent serious damage. In this case, the
Chuas were paying MERALCO customers. In the absence of the prima facie
evidence required by Section 4 of RA 7832 and the requirements of Section 6
of RA 7832, and in light as well of the improbability that the Chuas tampered
with their electric meter (as discussed below), the Chuas had an
unmistakable right to be provided with continuous power supply – a right
MERALCO invaded when it cut off their electric service. Electricity being what
it is and has been in modern day living, an urgent and permanent need
existed to prevent MERALCO from cutting off the Chuas’ electric service.

(3) The Chuas were not accountable for the differential billing.

Since the prima facie presumption afforded by Section 4 of RA 7832 did not
apply, it fell upon MERALCO to first prove that the Chuas actually
manipulated the dial pointers on their meter before it could hold them
accountable for the differential billing. The following circumstances, however,
cast serious doubt on the allegation that the Chuas ever tampered with their
electric meter: First, the Chuas themselves requested MERALCO to inspect
their meter for possible defects after they received their unusually high
September 1996 bill. Had the Chuas been guilty of tampering, they would
not have drawn attention to themselves by reporting

the problem with their meter; as the beneficial users of the electric service,
they would have been MERALCO’s main suspects once the tampering came
to light. Second, when a tampered electric meter is replaced, assuming the
same amount of monthly rate of usage, the new electric meter will register
the increased use of electricity that had previously been concealed by the
tampered meter. The Chuas’ monthly electric consumption, however,
remained virtually unchanged even after the defective electric meter had
been replaced.

Given the surrounding circumstances, the Chuas’ long-term electric

consumption record, the exposed location of their electric meter, the unusual
upward spike of the meter reading in September 1996, the inspection and
the replacement by a new electric meter, and the continued readings
consistent with the readings prior to the

September 1996 spike, it would not be surprising if the tampering of the

seals came immediately beforem September 1996 and were made by parties
other than the Chuas for their own reasons. The Chuas would not have
tampered with their own meter to increase their meter reading. Furthermore,
MERALCO did not provide any factual or legal basis for its differential billing
in accordance with Section 6 of RA 7832.

According to MERALCO’s witness, the period affected by the Chuas’

tampered electric meter was from 17 August 1992 to 11 October 1996. Said
witness, however, did not explain how he established this 4-year period as
the period affected by the tampered electric meter. He did not mention any
abrupt or abnormal drop in the

Chuas’ electric consumption, nor did he identify anything suspicious in the

Chuas’ billing history that would lead him to conclude that the tampering
began on 17 August 1992. His testimony was also uncorroborated by
evidence.

MERALCO used the Chuas’ September 1996 bill to compute the differential
billing – the same bill that theChuas protested with Meralco for being
extraordinarily high. While Section 6 of RA 7832 allows MERALCO touse the
consumer’s highest recorded monthly consumption as the basis to compute
the differential billing, still, Meralco – after examining the Chuas’ records for
the past 4 years – should have noticed that the September 1996 bill was
truly unusual. Based on their billing history, the Chuas consistently
consumed no more than 300 kilowatt hours of electricity every month for the
past 4 years, but their usage under the September 1996 bill

dramatically spiked to 1,297 kilowatt hours, or a difference of more than

400%. Moreover, after MERALCO replaced the alleged tampered electric
meter, the Chuas continued to consume the same amount of electricity they
had consumed prior to the September 1996 bill. Given the strange
circumstances surrounding the September 1996 bill, MERALCO should have
exercised prudence and employed another method to compute the Chuas’
differential billing, such as using the estimated monthly consumption based
on a load inspection report. At the very least, MERALCO should have
investigated the Chuas’ complaint regarding the sudden increase in

their electric bill, especially considering the Chuas’ claim that they had not
done anything new or used any additional appliances during the period
covered by the September 1996 bill. Nothing in the record suggests that
MERALCO even attempted to study, or even tried to explain, the sudden
surge in the Chuas’ September 1996 bill.

Also, while MERALCO admitted, before the lower courts, the existence of its
second demand letter which reduced its original differential billing, it chose
to ignore the existence of this letter in its submissions to the Supreme Court,
and instead reverted to its demand for the original differential billing. Such
unexplained and inconsistent posture further strengthened the Court’s
doubts on to the legitimacy and correctness of the differential billing.

Moreover, the presence of a defect in the meter, whether inherent,

intentional or unintentional, including metertampering, which has existed for
a considerable length of time, will create a presumption of constructive
notice of such defect or tampering. MERALCO’s failure to discover such
defect or tampering, considering the length of time, will amount to
inexcusable negligence that will bar it from collecting differential billing
against the consumers.

If MERALCO’s findings were presumed correct, MERALCO discovered the

broken seals in the Chuas’ meter after more than 4 years (from August 1992
to October 1996), and only because the Chuas reported a possible defect
with their electric meter. During this long period, MERALCO’s personnel had
the opportunity to inspect and examine the Chuas’ electric meter to
determine the monthly dues payable. Notably, the alleged tampering in this
case did not require special training or knowledge to be detected; the
missing terminal seal, the broken cover seal, and the broken sealing wire of
the meter were visible to the naked eye and would have caught the attention
of MERALCO’s personnel in the course of their meter readings. And even if
MERALCO did not conduct its regular monthly inspections, it was reasonable
to expect that within said 4-year period, MERALCO would, at the very least,
annually examine the electric meter to verify its condition and to determine
the accuracy of its readings if ordinary examination showed defects as in the
case of the Chuas’ meter. That it failed to do so constituted inexcusable
negligence on its part, and barred it from collecting its differential billing.

(4) The Chuas were entitled to moral damages in the amount of

P100,000.00.

Considering the manner MERALCO disconnected the Chuas’ electric service,

the award of moral damages was proper. Apart from the havoc wreaked on
the Chuas’ daily lives when MERALCO abruptly and without legal basis cut off
their electricity, the removal of the electric meter also caused the Chuas
extreme social humiliation

and embarrassment as they were subjected to speculations in their

neighborhood of being “power thieves.” As Mrs. Felicidad Chua testified, she
suffered sleepless nights and felt serious anxiety after the removal of their
electric meter came to the attention of the barangay. She even had to
consult a doctor for this anxiety. Thus,even if the Chuas subsequently
obtained their electricity from another source, the damage to the Chuas’
reputation and social standing had already been done.

As prevailing jurisprudence deems the award of moral damages in the

amount of P100,000.00 appropriate in cases where MERALCO wrongfully
disconnected electric service, the CA’s ruling, reducing the moral damages
awarded from P300,000.00 to P100,000.00, was sustained.

13. G.R. No. 118712 | October 6, 1995 | LAND BANK OF THE PHILIPPINES,
petitioner, vs.
COURT OF APPEALS, PEDRO L. YAP, HEIRS OF EMILIANO F.
SANTIAGO,AGRICULTURAL MANAGEMENT & DEVELOPMENT CORP.,
respondents.

FACTS:The nature of the case is the consolidation of two separate petitions

for review filed by Department of Agrarian Reform and Land Bank of the
Philippines, assailing the Court of Appeal’s decision, which granted private
respondents' petition for Certiorari and Mandamus.
Pedro Yap, Heirs of Emiliano Santiago, Agricultural Management and
Development Corporation or AMADCOR (private respondents) are
landowners whose landholdings were acquired by the DAR and subjected to
transfer schemes to qualified beneficiaries under the Comprehensive
Agrarian Reform Law (RA 6657). Aggrieved by the alleged lapses of the DAR
and the Landbank with respect to the valuation and payment of
compensation for their land, private respondents filed with the Supreme
Court a petition questioning the validity of DAR Administrative Order No. 6
(1992) and No. 9 (1990), and sought to compel the DAR to expedite the
pending summary administrative proceedings to finally determine the just
compensation of their properties, and the Landbank to deposit in cash and
bonds the amounts respectively "earmarked", "reserved" and "deposited in
trust accounts" for private respondents, and to allow them to withdraw the
same. The Supreme Court referred the petition to CA for proper
determination and disposition. The CA found the following facts undisputed:
Respondents argued that Admin. Order No. 9 (1990) was issued in
grave abuse of discretion amounting excess in jurisdiction because it permits
the opening of trust accounts by the Landbank, in lieu of depositing in cash
or bonds in an accessible bank designated by the DAR, the compensation for
the land before it is taken and the titles are cancelled as provided under
Section 16(e) of RA 6657. DAR and the Landbank merely "earmarked",
"deposited in trust" or"reserved" the compensation in their names as
landowners despite the clear mandate that before taking possession of the
property, the compensation must be deposited in cash or inbonds. On the
other hand, petitioner DAR contended that Admin Order No. 9 is a valid
exercise of its rule-making power pursuant to Section 49 of RA 6657.
The issuance of the "Certificate of Deposit" by the Landbank was a
substantial compliance with Section 16(e) of RA 6657. Landbank averred that
the issuance of the Certificates of Deposits is in consonance with Circular
Nos. 29, 29-A and 54 of the Land Registration Authority where the
words"reserved/deposited" were also used.

ISSUES:
1. Whether or not the CA erred in declaring as null and void DAR Admin
Order No. 9 (1990) insofar as it provides for the opening of trust
accounts in lieu of deposit in cash or in bonds
2. Whether or not the CA erred in holding that private respondents are
entitled as a matter of right to the immediate and provisional release
of the amounts deposited in trust pending the final resolution of the
cases it has filed for just compensation.

RULING: 1. NO. Section 16 (e) of RA 6657 provides:

Procedure for Acquisition of Private Lands. (e) Upon receipt by the
landowner of the corresponding payment or, in case of rejection or no
response from the landowner, upon the deposit with an accessible bank
designated by the DAR of the compensation in cash or in LBP bonds in
accordance with this Act, the DAR shall take immediate possession of the
land and shall request the proper Register of Deeds to issue a TCT in the
name of the Republic of the Philippines.
It is explicit that the deposit must be made only in "cash" or in
"LBP bonds". Nowhere does it appear nor can it be inferred that the deposit
can be made in any other form. There is no ambiguity in Section 16(e) of RA
6657 to warrant an expanded construction of the term "deposit". The
conclusive effect of administrative construction is not absolute. Action of an
administrative agency may be disturbed or set aside by the judicial
department if there is an error of law, a grave abuse of power or lack of
jurisdiction or grave abuse of discretion clearly conflicting with either the
letter or the spirit of a legislative enactment.
The function of promulgating rules and regulations may be legitimately
exercised only for the purpose of carrying the provisions of the law into
effect. The power of administrative agencies is thus confined to
implementing the law or putting it into effect. Corollary to this is that
administrative regulations cannot extend the law and amend a legislative
enactment, forsettled is the rule that administrative regulations must
be in harmony with the provisions of the law. And in case there is a
discrepancy between the basic law and an implementing rule or
regulation, it is the former that prevails.

2. YES. To withhold the right of the landowners to appropriate the amounts

already deposited in their behalf as compensation for their properties simply
because they rejected the DAR's valuation (P 1,455,207.31 Pedro L. Yap/ P
135,482.12 Heirs of Emiliano Santiago/ P 15,914,127.77 AMADCOR), and
notwithstanding that they have already been deprived of the possession and
use of such properties, is an oppressive exercise of eminent domain. It is
unnecessary to distinguish between provisional compensation under Section
16(e) and final compensation under Section 18 for purposes of exercising the
landowners' right to appropriate the same. The immediate effect in both
situations is the same; the landowner is deprived of the use and possession
of his property for which he should be fairly and immediately compensated.
Wherefore, petition is denied for lack of merit. Appealed decision is
affirmed.

LAND BANK OF THE PHILIPPINES, petitioner,

vs.
COURT OF APPEALS, PEDRO L. YAP, HEIRS OF EMILIANO F.
SANTIAGO, AGRICULTURAL MANAGEMENT & DEVELOPMENT CORP.,
respondents.
G.R. No. 118712
October 6, 1995 (2D)

DEPARTMENT OF AGRARIAN REFORM, represented by the Secretary

of Agrarian Reform, petitioner,
vs.
COURT OF APPEALS, PEDRO L. YAP, HEIRS OF EMILIANO F.
SANTIAGO, AGRICULTURAL MANAGEMENT & DEVELOPMENT CORP.,
ET AL., respondents.
G.R. No. 118745
October 6, 1995

Facts: Separate petitions for review were filed by petitioners

Department of Agrarian Reform (DAR) (G.R. No. 118745) and Land Bank of
the Philippines (LBP) (G.R. No. 118712) following the adverse ruling by the
Court of Appeals, granting private respondents' Petition for Certiorari and
Mandamus. However, upon motion filed by private respondents, the petitions
were ordered consolidated. Likewise, petitioners seek the reversal of the
Resolution, denying their motion for reconsideration.

Private respondents are landowners whose landholdings were acquired

by the DAR and subjected to transfer schemes to qualified beneficiaries
under the Comprehensive Agrarian Reform Law (CARL). Aggrieved by the
alleged lapses of the DAR and LBP with respect to the valuation and payment
of compensation for their land pursuant to the provisions of RA 6657, private
respondents filed with the Court a Petition for Certiorari and Mandamus with
prayer for preliminary mandatory injunction. Private respondents argued that
Administrative Order No. 9, Series of 1990 was issued without jurisdiction
and with grave abuse of discretion because it permits the opening of trust
accounts by the LBP, in lieu of depositing in cash or bonds in an accessible
bank designated by the DAR, the compensation for the land before it is taken
and the titles are cancelled as provided under Section 16(e) of RA 6657.
Private respondents also assail the fact that the DAR and the LBP merely
"earmarked", "deposited in trust" or "reserved" the compensation in their
names as landowners despite the clear mandate that before taking
possession of the property, the compensation must be deposited in cash or
in bonds. The respondent court rendered the assailed decision in favor of
private respondents. Petitioners filed a motion for reconsideration but
respondent court denied the same, hence, the instant petitions.

Issue: Whether or not the deposit may be made in other forms besides
cash or LBP bonds

Held:In the present suit, the DAR clearly overstepped the limits of its power
to enact rules and regulations when it issued Administrative Circular No. 9.
There is no basis in allowing the opening of a trust account in behalf of the
landowner as compensation for his property because Section 16(e) of RA
6657 is very specific that the deposit must be made only in "cash" or in "LBP
bonds". If it were the intention to include a "trust account" among the valid
modes of deposit that should have been made express, or at least, qualifying
words ought to have appeared from which it can be fairly deduced that a
"trust account" is allowed.

The ruling in the "Association" case merely recognized the

extraordinary nature of the expropriation to be undertaken under RA 6657
thereby allowing a deviation from the traditional mode of payment of
compensation and recognized payment other than in cash. It did not,
however, dispense with the settled rule that there must be full payment of
just compensation before the title to the expropriated property is
transferred.

Issue: Whether or not there should be a distinction the deposit of

compensation and determination of just compensation

Held:To withhold the right of the landowners to appropriate the amounts

already deposited in their behalf as compensation for their properties simply
because they rejected the DAR's valuation, and notwithstanding that they
have already been deprived of the possession and use of such properties is
an oppressive exercise of eminent domain. It is unnecessary to distinguish
between deposit of compensation (provisional) under Section 16(e) and
determination of just compensation (final) under Section 18 for purposes of
exercising the landowners' right to appropriate the same. The immediate
effect in both situations is the same the landowner is deprived of the use and
possession of his property for which he should be fairly and immediately
compensated.

14. Case Digest: ASTEC vs. ERC

G.R. No. 192117 : September 18, 2012

ASSOCIATION OF SOUTHERN TAGALOG ELECTRIC COOPERATIVES,

INC. (ASTEC), BATANGAS I ELECTRIC COOPERATIVE, INC. (BATELEC
I), QUEZON I ELECTRIC COOPERATIVE, INC. (QUEZELCO I), and
QUEZON II ELECTRIC COOPERATIVE, INC. (QUEZELCO II), Petitioners,
v. ENERGY REGULATORY COMMISSION, Respondent.

x - - - - - - - - - - - - - - - - - - - - -- - x

G.R. No. 192118 : September 18, 2012

CENTRAL LUZON ELECTRIC COOPERATIVES ASSOCIATION, INC.

(CLEA) and PAMPANGA RURAL ELECTRIC SERVICE COOPERATIVE,
INC. (PRESCO), Petitioners, v. ENERGY REGULATORY COMMISSION,
Respondent.

CARPIO, J.:
DOCTRINE:Procedural due process demands that administrative rulesand
regulations be published in order to be effective. There are,
however,s e ve r a l e x ce p t i o n s t o t h e r e q u i r e m e n t o f p u b l i c a t i o n .
F i r s t , a n interpretative regulation does not require publication in
order to beeffective. The applicability of an interpretative regulation
"needs nothingfurther than its bare issuance for it gives no real
consequence more thanwhat the law itself has already prescribed." It "adds
nothing to the law" and"does not affect the substantial rights of any person."
Second, a regulationthat is merely internal in nature does not require
publication for itseffectivity. It seeks to regulate only the personnel of
the administrativeagency and not the general public. Third, a letter of
instruction issued byan administrative agency concerning rules or
guidelines to be followed bysubordinates in the performance of their
duties does not require publication in order to be effective

FACTS:

Petitioners Batangas I Electric Cooperative, Inc. (BATELEC I), Quezon I

Electric Cooperative, Inc. (QUEZELCO I), Quezon II Electric Cooperative, Inc.
(QUEZELCO II) and Pampanga Rural Electric Service Cooperative, Inc.
(PRESCO) are rural electric cooperatives established under P.D. No. 269.
BATELEC I, QUEZELCO I and QUEZELCO II are members of the Association of
Southern Tagalog Electric Cooperatives, Inc. (ASTEC). PRESCO is a member
of the Central Luzon Electric Cooperatives Association, Inc. (CLECA).
BATELEC I, et al. are engaged in the distribution of electricity.

On 8 December 1994, R.A. No. 7832 or the Anti-Electricity and Electric

Transmission Lines/Materials Pilferage Act of 1994 was enacted. The law
imposed a cap on the recoverable rate of system loss that may be charged
by rural electric cooperatives to their consumers. The IRR of R.A. No. 7832
required every rural electric cooperative to file with the Energy Regulatory
Board (ERB), on or before 30 September 1995, an application for approval of
an amended Power Purchase Agreement (PPA) Clause incorporating the cap
on the recoverable rate of system loss to be included in its schedule of rates.

On 8 June 2001, R.A. No. 9136 or the Electric Power Industry Reform Act of
2001 (EPIRA) was also enacted. Section 38 of the EPIRA abolished the ERB,
and created the Energy Regulatory Commission (ERC). The ERC issued an
Order which provides that rural electric cooperatives should only recover
from their members and patrons the actual cost of power purchased from
power suppliers. The ERC also ordered BATELEC, et al. to refund their
respective over-recoveries to end-users. In addition, the ERC also adopted
the new "grossed-up factor mechanism" in the computation of the over-
recoveries of the electric cooperatives to be remitted to their consumers.

Thus, BATELEC I, et al. moved to reconsider the said orders but the ERC
denied the same. On appeal, the CA upheld the validity of the ERC Orders.

Hence, this petition. BATELEC I, et al. aver that these ERC Orders are invalid
for lack of publication, non-submission to the U.P. Law Center, and for their
retroactive application.

ISSUE: Whether or not the assailed orders are invalid for non-publication,
non-submission to the U.P. Law Center and for their retroactivity?

HELD: The petition is partly meritorious.

CIVIL LAW: publication of laws

Procedural due process demands that administrative rules and regulations

be published in order to be effective. In Tada v. Tuvera, this Court articulated
the fundamental requirement of publication, thus: "We hold therefore that all
statutes, including those of local application and private laws, shall be
published as a condition for their effectivity, which shall begin fifteen days
after publication unless a different effectivity date is fixed by the legislature.
Administrative rules and regulations must also be published if their purpose
is to enforce or implement existing law pursuant also to a valid delegation."

There are, however, several exceptions to the requirement of publication.

First, an interpretative regulation does not require publication in order to be
effective. The applicability of an interpretative regulation "needs nothing
further than its bare issuance for it gives no real consequence more than
what the law itself has already prescribed." It "adds nothing to the law" and
"does not affect the substantial rights of any person." Second, a regulation
that is merely internal in nature does not require publication for its
effectivity. It seeks to regulate only the personnel of the administrative
agency and not the general public. Third, a letter of instruction issued by an
administrative agency concerning rules or guidelines to be followed by
subordinates in the performance of their duties does not require publication
in order to be effective.

The policy guidelines of the ERC on the treatment of discounts extended by

power suppliers are interpretative regulations. Publication is not necessary
for the effectivity of the policy guidelines. As interpretative regulations, the
policy guidelines of the ERC on the treatment of discounts extended by
power suppliers are also not required to be filed with the U.P. Law Center in
order to be effective.

In Republic v. Sandiganbayan, this Court recognized the basic rule "that no

statute, decree, ordinance, rule or regulation (or even policy) shall be given
retrospective effect unless explicitly stated so." A law is retrospective if it
"takes away or impairs vested rights acquired under existing laws, or creates
a new obligation and imposes a new duty, or attaches a new disability, in
respect of transactions or consideration already past." The policy guidelines
of the ERC on the treatment of discounts extended by power suppliers are
not retrospective. The policy guidelines did not take away or impair any
vested rights of the rural electric cooperatives. Furthermore, the policy
guidelines of the ERC did not create a new obligation and impose a new duty,
nor did it attach a new disability.

However, the grossed-up factor mechanism amends the IRR of R.A. No. 7832
as it serves as an additional numerical standard that must be observed and
applied by rural electric cooperatives in the implementation of the PPA. In
light of these, the grossed-up factor mechanism does not merely interpret
R.A. No. 7832 or its IRR.It is also not merely internal in nature. The grossed-
up factor mechanism amends the IRR by providing an additional numerical
standard that must be observed and applied in the implementation of the
PPA. The grossed-up factor mechanism is therefore an administrative rule
that should be published and submitted to the U.P. Law Center in order to be
effective.

As previously stated, it does not appear from the records that the grossed-up
factor mechanism was published and submitted to the U.P. Law Center.
Thus, it is ineffective and may not serve as a basis for the computation of
over-recoveries. The portions of the over-recoveries arising from the
application of the mechanism are therefore invalid. Furthermore, the
application of the grossed-up factor mechanism to periods of PPA
implementation prior to its publication and disclosure renders the said
mechanism invalid for having been applied retroactively.

PARTLY GRANTED

15. PEOPLE VS. MACEREN

Administrative regulations adopted under legislative authority by a particular

department must be in harmony with the provisions of the law, and should
be for the sole purpose of carrying into effect its general provisions. By such
regulations, the law itself cannot be extended. An administrative agency
cannot amend an act of Congress.

FACTS:

The respondents were charged with violating Fisheries Administrative Order

No. 84-1 which penalizes electro fishing in fresh water fisheries. This was
promulgated by the Secretary of Agriculture and Natural Resources and the
Commissioner of Fisheries under the old Fisheries Law and the law creating
the Fisheries Commission. The municipal court quashed the complaint and
held that the law does not clearly prohibit electro fishing, hence the
executive and judicial departments cannot consider the same. On appeal,
the CFI affirmed the dismissal. Hence, this appeal to the SC.

ISSUE: Whether the administrative order penalizing electro fishing is valid?

HELD:

NO. The Secretary of Agriculture and Natural Resources and the

Commissioner of Fisheries exceeded their authority in issuing the
administrative order. The old Fisheries Law does not expressly prohibit
electro fishing. As electro fishing is not banned under that law, the Secretary
of Agriculture and Natural Resources and the Commissioner of Fisheries are
powerless to penalize it. Had the lawmaking body intended to punish electro
fishing, a penal provision to that effect could have been easily embodied in
the old Fisheries Law. The lawmaking body cannot delegate to an executive
official the power to declare what acts should constitute an offense. It can
authorize the issuance of regulations and the imposition of the penalty
provided for in the law itself. Where the legislature has delegated to
executive or administrative officers and boards authority to promulgate rules
to carry out an express legislative purpose, the rules of administrative
officers and boards, which have the effect of extending, or which conflict
with the authority granting statute, do not represent a valid precise of the
rule-making power.

PEOPLE v MACEREN

79 SCRA 450

AQUINO; October 18, 1977

FACTS

- Section 11 of the Fisheries Law prohibits "the use of any obnoxious or

poisonous substance" in fishing.

- The Secretary of Agriculture and Natural Resources, upon the

recommendation of the Commissioner of Fisheries, promulgated Fisheries
Administrative Order No. 84 (62 O.G. 1224), prohibiting electro fishing in all
Philippine waters.

- Jose Buenaventura, Godofredo Reyes, Benjamin Reyes, Nazario Aquino and

Carlito del Rosario were charged with having violated Fisheries
Administrative Order No. 84-1. It was alleged that they engaged in electro
fishing.

- Upon motion of the accused, the municipal court dismissed the case. CFI
affirmed. The lower court held that electro fishing cannot be penalized
because electric current is not an obnoxious or poisonous substance as
contemplated in section II of the Fisheries Law. The lower court further held
that, since the law does not clearly prohibit electro fishing, the executive and
judicial departments cannot consider it unlawful.

ISSUE/S

1. WON the Secretary of Agriculture and Natural Resources exceeded his

authority in issuing Fisheries Administrative Order No. 84

HELD

1. YES.

Ratio The rule-making power must be confined to details for regulating the
mode or proceeding to carry into effect the law as it his been enacted. The
power cannot be extended to amending or expanding the statutory
requirements or to embrace matters not covered by the statute

Reasoning The Fisheries Law does not expressly prohibit electro fishing. As
electro fishing is not banned under that law, the Secretary of Agriculture and
Natural Resources and the Commissioner of Fisheries are powerless to
penalize it. Had the lawmaking body intended to punish electro fishing, a
penal provision to that effect could have been easily embodied in the old
Fisheries Law. Nowhere in the said law is electro fishing specifically
punished.

Administrative agents are clothed with rule-making powers because the

lawmaking body finds it impracticable, if not impossible, to anticipate and
provide for the multifarious and complex situations that may be encountered
in enforcing the law. All that is required is that the regulation should be
germane to the defects and purposes of the law and that it should conform
to the standards that the law prescribes

16. Sec. Perez v LPG Refillers

Facts: Batas Pambansa Blg. 33, as amended, penalizes illegal trading,

hoarding, overpricing, adulteration, underdelivery, and underfilling of
petroleum products, as well as possession for trade of adulterated petroleum
products and of underfilled liquefied petroleum gas (LPG) cylinder. The said
law sets the monetary penalty for violators to a minimum of P 20,000 and a
maximum of P 50,000. Respondent LPG Refillers Association of the
Philippines asked the DOE to set aside the Circular for being contrary to law
but to no avail, hence they filed an action before the RTC to nullify the
circular.

Issue: Whether or not the circular is valid

Held: For an administrative regulation, to have the force of penal law, the
following must concur:

1.) the violation of the administrative regulation must be made a crime by

the delegating statute itself; and

2.) the penalty for such violation must be provided by the statute itself.

As to the first requirement, BP Blg 33 only states merely lists the various
modes by which the said criminal acts may be perpetrated, namely: no price
display board, no weighing scale, no tare weight or incorrect tare weight
markings, no authorized LPG seal, no trade name, unbranded LPG cylinders,
no serial number, no distinguishing color, no embossed identifying markings
on cylinder, underfilling LPG cylinders, tampering LPG cylinders, and
unauthorized decanting of LPG cylinders.The acts and omissions stated in
the circular are well within the modes contemplated by the law and serve the
purpose of curbing pernicious practices of LPG dealers.

As for the second requirement, the statute provides a minimum and

maximum amount as penalties. The maximum pecuniary penalty for retail
outlets is P20,000, an amount within the range allowed by law. While the
circular is silent as to the max penalty for refillers, marketers, and dealers,
such does not amount to violation of the statutory maximum limit.
The mere fact that the Circular provides penalties on a per cylinder basis
does not in itself run counter to the law since all that B.P. Blg. 33 prescribes
are the minimum and the maximum limits of penalties. Nothing in the
Circular contravenes the law.

Noteworthy, the enabling laws on which the Circular is based were

specifically intended to provide the DOE with increased administrative and
penal measures with which to effectively curtail rampant adulteration and
shortselling, as well as other acts involving petroleum products, which are
inimical to public interest. To nullify the Circular in this case would be to
render inutile government efforts to protect the general consuming public
against the nefarious practices of some unscrupulous LPG traders.

[G.R. No. 101279. August 6, 1992.]

PHILIPPINE ASSOCIATION OF SERVICE EXPORTERS, INC. petitioner,
vs. HON. RUBEN D. TORRES, as Secretary of the Department of
Labor & Employment, and JOSE N. SARMIENTO, as Administrator of
the PHILIPPINE OVERSEAS EMPLOYMENT ADMINISTRATION,
respondents.

FACTS

DOLE Secretary Ruben D. Torres issued Department Order No. 16 Series of

1991 temporarily suspending the recruitment by private employment
agencies of “Filipino domestic helpers going to Hong Kong”. As a result of
the department order DOLE, through the POEA took over the business of
deploying Hong Kong bound workers.

The petitioner, PASEI, the largest organization of private employment and

recruitment agencies duly licensed and authorized by the POEA to engage in
the business of obtaining overseas employment for Filipino land-based
workers filed a petition for prohibition to annul the aforementioned order and
to prohibit implementation.

ISSUES

(1) whether or not respondents acted with grave abuse of discretion and/or
in excess of their rule-making authority in issuing said circulars;
(2) whether or not the assailed DOLE and POEA circulars are contrary to the
Constitution, are unreasonable, unfair and oppressive; and
(3) whether or not the requirements of publication and filing with the Office
of the National Administrative Register were not complied with.

HELD
FIRST, the respondents acted well within in their authority and did not
commit grave abuse of discretion. This is because Article 36 (LC) clearly
grants the Labor Secretary to restrict and regulate recruitment and
placement activities, to wit:
Art. 36. Regulatory Power. — The Secretary of Labor shall have the
power to restrict and regulate the recruitment and placement activities
of all agencies within the coverage of this title [Regulation of
Recruitment and Placement Activities] and is hereby authorized to
issue orders and promulgate rules and regulations to carry out the
objectives and implement the provisions of this title.

SECOND, the vesture of quasi-legislative and quasi-judicial powers in

administrative bodies is constitutional. It is necessitated by the growing
complexities of the modern society.

THIRD, the orders and circulars issued are however, invalid and
unenforceable. The reason is the lack of proper publication and filing in the
Office of the National Administrative Registrar as required in Article 2 of the
Civil Code to wit:
Art. 2. Laws shall take effect after fifteen (15) days following the
completion of their publication in the Official Gazatte, unless it is
otherwise provided;
Article 5 of the Labor Code to wit:
Art. 5. Rules and Regulations. — The Department of Labor and other
government agencies charged with the administration and
enforcement of this Code or any of its parts shall promulgate the
necessary implementing rules and regulations. Such rules and
regulations shall become effective fifteen (15) days after
announcement of their adoption in newspapers of general circulation;
and Sections 3(1) and 4, Chapter 2, Book VII of the Administrative Code of
1987 which provide:
Sec. 3. Filing. — (1) Every agency shall file with the University of the
Philippines Law Center, three (3) certified copies of every rule adopted
by it. Rules in force on the date of effectivity of this Code which are not
filed within three (3) months shall not thereafter be the basis of any
sanction against any party or persons. (Chapter 2, Book VII of the
Administrative Code of 1987.)
Sec. 4. Effectivity. — In addition to other rule-making requirements
provided by law not inconsistent with this Book, each rule shall become
effective fifteen (15) days from the date of filing as above provided
unless a different date is fixed by law, or specified in the rule in cases
of imminent danger to public health, safety and welfare, the existence
of which must be expressed in a statement accompanying the rule.
The agency shall take appropriate measures to make emergency rules
known to persons who may be affected by them. (Chapter 2, Book VII
of the Administrative Code of 1987).
Prohibition granted.

17. [G.R. No. 103144. April 4, 2001.]

PHILSA INTERNATIONAL PLACEMENT and SERVICES

CORPORATION, Petitioner, v. THE HON. SECRETARY OF LABOR AND
EMPLOYMENT, VIVENCIO DE MESA, RODRIGO MIKIN and CEDRIC
LEYSON, Respondents.

DECISION

GONZAGA-REYES, J.:

This is a petition for certiorari from the Order dated November 25, 1991

issued by public respondent Secretary of Labor and Employment. The
November 25, 1991 Order affirmed en toto the August 29, 1988 Order of the
Philippine Overseas Employment Administration (hereinafter the "POEA")
which found petitioner liable for three (3) counts of illegal exaction, two (2)
counts of contract substitution and one count of withholding or unlawful
deduction from salaries of workers in POEA Case No. (L) 85-05-0370.

Petitioner Philsa International Placement and Services Corporation

(hereinafter referred to as "Philsa") is a domestic corporation engaged in the
recruitment of workers for overseas employment. Sometime in January 1985,
private respondents, who were recruited by petitioner for employment in
Saudi Arabia, were required to pay placement fees in the amount of
P5,000.00 for private respondent Rodrigo L. Mikin and P6,500.00 each for
private respondents Vivencio A. de Mesa and Cedric P. Leyson 1 .

After the execution of their respective work contracts, private respondents

left for Saudi Arabia on January 29, 1985. They then began work for Al-
Hejailan Consultants A/E, the foreign principal of petitioner.

While in Saudi Arabia, private respondents were allegedly made to sign a

second contract on February 4, 1985 which changed some of the provisions
of their original contract resulting in the reduction of some of their benefits
and privileges 2 . On April 1, 1985, their foreign employer allegedly forced
them to sign a third contract which increased their work hours from 48 hours
to 60 hours a week without any corresponding increase in their basic
monthly salary. When they refused to sign this third contract, the services of
private respondents were terminated by Al-Hejailan and they were
repatriated to the Philippines 3 .
Upon their arrival in the Philippines, private respondents demanded from
petitioner Philsa the return of their placement fees and for the payment of
their salaries for the unexpired portion of their contract. When petitioner
refused, they filed a case before the POEA against petitioner Philsa and its
foreign principal, Al-Hejailan., with the following causes of action:chanrob1es
virtual 1aw library

1. Illegal dismissal;

2. Payment of salary differentials;

3. Illegal deduction/withholding of salaries;

4. Illegal exactions/refund of placement fees; and

5. Contract substitution. 4

The case was docketed as POEA Case No. (L) 85-05 0370.

Under the rules of the POEA dated May 21, 1985, complaints involving
employer-employee relations arising out of or by virtue of any law or
contract involving Filipino workers for overseas employment, including
money claims, are adjudicated by the Workers’ Assistance and Adjudication
Office (hereinafter the "WAAO") thru the POEA Hearing Officers5 . On the
other hand, complaints involving recruitment violations warranting
suspension or cancellation of the license of recruiting agencies are
cognizable by the POEA thru its Licensing and Recruitment Office
(hereinafter the "LRO"). 6 In cases where a complaint partakes of the nature
of both an employer-employee relationship case and a recruitment
regulation case, the POEA Hearing Officer shall act as representative of both
the WAAO and the LRO and both cases shall be heard simultaneously. In
such cases, the Hearing Officer shall submit two separate recommendations
for the two aspects of the case. 7

In the case at bench, the first two causes of action were in the nature of
money claims arising from the employer-employee relations and were
properly cognizable by the WAAO. The last two causes of action were in the
nature of recruitment violations and may be investigated by the LRO. The
third cause of action, illegal deduction/withholding of salary, is both a money
claim and a violation of recruitment regulations and is thus under the
investigatory jurisdiction of both the WAAO and the LRO.

Several hearings were conducted before the POEA Hearing Officer on the two
aspects of private respondents’ complaint. During these hearings, private
respondents supported their complaint with the presentation of both
documentary and testimonial evidence. When it was its turn to present its
evidence, petitioner failed to do so and consequently, private respondents
filed a motion to decide the case on the basis of the evidence on record. 8

On the aspects of the case involving money claims arising from the
employer-employee relations and illegal dismissal, the POEA rendered a
decision dated August 31, 1988 9 , the dispositive portion of which
reads:jgc:chanrobles.com.ph

"CONFORMABLY TO THE FOREGOING, judgment is hereby rendered ordering

respondent PHILSA INTERNATIONAL PLACEMENT AND SERVICE
CORPORATION to pay complainants, jointly and severally with its principal Al-
Hejailan, the following amounts, to wit:chanrob1es virtual 1aw library

1. TWO THOUSAND TWO HUNDRED TWENTY FIVE SAUDI RIYALS (SR2,225.00)

to each complainant, representing the refund of their unpaid separation pay;

2. ONE THOUSAND SAUDI RIYALS (SR1,000.00) for V.A. de Mesa alone,

representing the salary deduction from his March salary;

3. TWO THOUSAND SAUDI RIYALS (SR2,000.00) each for R.I. Mikin and C.A.P.
Leyson only, representing their differential pay for the months of February
and March, 1985; and

4. Five percent (5%) of the total awards as and by way of attorney’s fees.

All payments of the abovestated awards shall be made in Philippine Currency

equivalent to the prevailing exchange rate according to the Central Bank at
the time of payment.

All other claims of complainants as well as the counterclaims of respondent

are dismissed for lack of merit.

SO ORDERED." 10

Under the Rules and Regulations of the POEA, the decision of the POEA-
Adjudication Office on matters involving money claims arising from the
employer-employee relationship of overseas Filipino workers may be
appealed to the National Labor Relations Commission (hereinafter the
"NLRC)11 . Thus, as both felt aggrieved by the said POEA Decision, petitioner
and private respondents filed separate appeals from the August 31, 1988
POEA Decision to the NLRC.

In a decision dated July 26, 1989 12 , the NLRC modified the appealed
decision of the POEA Adjudication Office by deleting the award of salary
deductions and differentials. These awards to private respondents were
deleted by the NLRC considering that these were not raised in the complaint
filed by private respondents. The NLRC likewise stated that there was
nothing in the text of the decision which would justify the award.

Private respondents filed a Motion for Reconsideration but the same was
denied by the NLRC in a Resolution dated October 25; 1989.

Private respondents then elevated the July 26, 1989 decision of the NLRC to
the Supreme Court in a petition for review for certiorari where it was
docketed as G.R. No. 89089. However, in a Resolution dated October 25,
1989, the petition was dismissed outright for "insufficiency in form and
substance, having failed to comply with the Rules of Court and Circular No.
1-88 requiring submission of a certified true copy of the questioned
resolution dated August 23, 1989." 13

Almost simultaneous with the promulgation of the August 31, 1988 decision
of the POEA on private respondents’ money claims, the POEA issued a
separate Order dated August 29, 1988 14 resolving the recruitment
violations aspect of private respondents’ complaint. In this Order, the POEA
found petitioner guilty of illegal exaction, contract substitution, and unlawful
deduction. The dispositive portion of this August 29, 1988 POEA Order
reads:jgc:chanrobles.com.ph

"WHEREFORE, premises considered, this Office finds herein respondent

PHILSA International Placement and Services Corporation liable for three (3)
counts of illegal exaction, two (2) counts of contract substitution and one
count of withholding or unlawful deduction from salaries of workers.

Accordingly, respondent is hereby ordered to refund the placement fees in

the amount of P2,500.00 to Rodrigo L. Mikin, P4,000.00, each, to Vivencio A.
de Mesa and Cedric A.P. Leyson plus restitution of the salaries withheld in
the amount of SR1,000.00 to Vivencio A. de Mesa.

Moreover, respondent’s license is hereby suspended for eight (8) months to

take effect immediately and to remain as such until full refund and
restitution of the above-stated amounts have been effected or in lieu thereof,
it is fined the amount of SIXTY THOUSAND (P60,000.00) PESOS plus
restitution.

SO ORDERED."cralaw virtua1aw library

In line with this August 29, 1988 Order, petitioner deposited the check
equivalent to the claims of private respondents and paid the corresponding
fine under protest. From the said Order, petitioner filed a Motion for
Reconsideration which was subsequently denied in an Order dated October
10, 1989.
Under the POEA Rules and Regulations, the decision of the POEA thru the
LRO suspending or canceling a license or authority to act as a recruitment
agency may be appealed to the Ministry (now Department) of Labor and
Employment. 15 Accordingly, after the denial of its motion for
reconsideration, petitioner appealed the August 21, 1988 Order to the
Secretary of Labor and Employment. However, in an Order dated September
13, 199116 , public respondent Secretary of Labor and Employment affirmed
en toto the assailed Order. Petitioner filed a Motion for Reconsideration but
this was likewise denied in an Order dated November 25, 1991.

Hence, the instant Petition for Certiorari where petitioner raises the following

grounds for the reversal of the questioned Orders:chanrob1es virtual 1aw
library

THE PUBLIC RESPONDENT HAS ACTED WITHOUT OR IN EXCESS OF

JURISDICTION OR WITH GRAVE ABUSE OF DISCRETION IN HOLDING
PETITIONER GUILTY OF ILLEGAL EXACTIONS. THE FINDING IS NOT
SUPPORTED BY EVIDENCE AND IN ANY EVENT, THE LAW ON WHICH THE
CONVICTION IS BASED IS VOID.

II

THE PUBLIC RESPONDENT HAS ACTED WITHOUT OR IN EXCESS OF

JURISDICTION OR WITH GRAVE ABUSE OF DISCRETION IN PENALIZING
PETITIONER WITH CONTRACT SUBSTITUTION. IN THE PREMISES, THE
CONTRACT SUBSTITUTION IS VALID AS IT IMPROVED THE TERMS AND
CONDITIONS OF PRIVATE RESPONDENTS’ EMPLOYMENT.

III.

THE PUBLIC RESPONDENT HAS ACTED WITHOUT OR IN EXCESS OF

JURISDICTION, OR WITH GRAVE ABUSE OF DISCRETION IN HOLDING
PETITIONER LIABLE FOR ILLEGAL DEDUCTIONS/WITHHOLDING OF SALARIES
FOR THE SUPREME COURT ITSELF HAS ALREADY ABSOLVED PETITIONER
FROM THIS CHARGE.

With respect to the first ground, petitioner would want us to overturn the
findings of the POEA, subsequently affirmed by the Secretary of the
Department of Labor and Employment, that it is guilty of illegal exaction
committed by collecting placement fees in excess of the amounts allowed by
law. This issue, however, is a question of fact which cannot be raised in a
petition for certiorari under Rule 65. 17 As we have previously
held:jgc:chanrobles.com.ph

"It should be noted, in the first place, that the instant petition is a special
civil action for certiorari under Rule 65 of the Revised Rules of Court. An
extraordinary remedy, its use is available only and restrictively in truly
exceptional cases wherein the action of an inferior court, board or officer
performing judicial or quasi-judicial acts is challenged for being wholly void
on grounds of jurisdiction. The sole office of the writ of certiorari is the
correction of errors of jurisdiction including the commission of grave abuse of
discretion amounting to lack or excess of jurisdiction. It does not include
correction of public respondent NLRC’s evaluation of the evidence and
factual findings based thereon, which are generally accorded not only great
respect but even finality." 18

The question of whether or not petitioner charged private respondents

placement fees in excess of that allowed by law is clearly a question of fact
which is for public respondent POEA, as a trier of facts, to determine. As
stated above, the settled rule is that the factual findings of quasi-judicial
agencies like the POEA, which have acquired expertise because their
jurisdiction is confined to specific matters, are generally accorded not only
respect, but at times even finality if such findings are supported by
substantial evidence. 19

On this point, we have carefully examined the records of the case and it is
clear that the ruling of public respondent POEA that petitioner is guilty of
illegal exaction is supported by substantial evidence. Aside from the
testimonial evidence offered by private respondents, they also presented
documentary evidence consisting of receipts issued by a duly authorized
representative of petitioner which show the payment of amounts in excess of
those allowed by the POEA. In contrast, petitioner did not present any
evidence whatsoever to rebut the claims of private respondents despite the
many opportunities for them to do so.

Petitioner insists, however, that it cannot be held liable for illegal exaction as
POEA Memorandum Circular No. 11, Series of 1983, which enumerated the
allowable fees which may be collected from applicants, is void for lack of
publication.

There is merit in the argument.

In Tañada v. Tuvera 20 , the Court held, as follows:jgc:chanrobles.com.ph

"We hold therefore that all statutes, including those of local application and
private laws, shall be published as a condition for their effectivity, which shall
begin fifteen days after publication unless a different effectivity date is fixed
by the legislature.

Covered by this rule are presidential decrees and executive orders

promulgated by the President in the exercise of legislative powers whenever
the same are validly delegated by the legislature or, at present, directly
conferred by the Constitution: Administrative rules and regulations must also
be published if their purpose is to enforce or implement existing law
pursuant to a valid delegation.

Interpretative regulations and those merely internal in nature, that is,

regulating only the personnel of the administrative agency and the public,
need not be published. Neither is publication required of the so-called letter
of instructions issued by the administrative superiors concerning the rules or
guidelines to be followed by their subordinates in the performance of their
duties."cralaw virtua1aw library

Applying this doctrine, we have previously declared as having no force and

effect the following administrative issuances: a) Rules and Regulations
issued by the Joint Ministry of Health-Ministry of Labor and Employment
Accreditation Committee regarding the accreditation of hospitals, medical
clinics and laboratories 21; b) Letter of Instruction No. 416 ordering the
suspension of payments due and payable by distressed copper mining
companies to the national government 22; c) Memorandum Circulars issued
by the POEA regulating the recruitment of domestic helpers to Hong Kong
23; d) Administrative Order No. SOCPEC 89-08-01 issued by the Philippine
International Trading Corporation regulating applications for importation
from the People’s Republic of China 24; and e) Corporate Compensation
Circular No. 10 issued by the Department of Budget and Management
discontinuing the payment of other allowances and fringe benefits to
government officials and employees 25 . In all these cited cases, the
administrative issuances questioned therein were uniformly struck down as
they were not published or filed with the National Administrative Register as
required by the Administrative Code of 1987 26 .

POEA Memorandum Circular No. 2, Series of 1983 must likewise be declared

ineffective as the same was never published or filed with the National
Administrative Register.

POEA Memorandum Order No. 2, Series of 1983 provides for the applicable
schedule of placement and documentation fees for private employment
agencies or authority holders. Under the said Order, the maximum amount
which may be collected from prospective Filipino overseas workers is
P2,500.00. The said circular was apparently issued in compliance with the
provisions of Article 32 of the Labor Code which provides, as
follows:jgc:chanrobles.com.ph
"ARTICLE 32. Fees to be paid by workers. — Any person applying with a
private fee-charging employment agency for employment assistance shall
not be charged any fee until he has obtained employment through its efforts
or has actually commenced employment. Such fee shall be always covered
with the approved receipt clearly showing the amount paid. The Secretary of
Labor shall promulgate a schedule of allowable fees." (Emphasis supplied)

It is thus clear that the administrative circular under consideration is one of

those issuances which should be published for its effectivity, since its
purpose is to enforce and implement an existing law pursuant to a valid
delegation 27 . Considering that POEA Administrative Circular No. 2, Series of
1983 has not as yet been published or filed with the National Administrative
Register, the same is ineffective and may not be enforced.

The Office of the Solicitor General argues however that the imposition of
administrative sanctions on petitioner was based not on the questioned
administrative circular but on Article 32 and Article 34 (a) 28 of the Labor
Code.

The argument is not meritorious. The said articles of the Labor Code were
never cited, much less discussed, in the body of the questioned Orders of the
POEA and Secretary of Labor and Employment. In fact, the said Orders were
consistent in mentioning that petitioner’s violation of Administrative Circular
No. 2, Series of 1983 was the basis for the imposition of administrative
sanctions against petitioner. Furthermore, even assuming that petitioner was
held liable under the said provisions of the Labor Code, Articles 32 and 34 (a)
of the Labor Code presupposes the promulgation of a valid schedule of fees
by the Department of Labor and Employment. Considering that, as,
previously discussed, Administrative Circular No. 2, Series of 1983
embodying such a schedule of fees never took effect, there is thus no basis
for the imposition of the administrative sanctions against petitioner.
Moreover, under Book VI, Chapter II, Section 3 of the Administrative Code of
1987," (r)ules in force on the date of the effectivity of this Code which are
not filed within three (3) months from that date shall not thereafter be the
basis of any sanction against any party or persons." Considering that POEA
Administrative Circular No. 2 was never filed with the National Administrative
Register, the same cannot be used as basis for the imposition of
administrative sanctions against petitioner.

The Office of the Solicitor General likewise argues that the questioned
administrative circular is not among those requiring publication
contemplated by Tañada v. Tuvera as it is addressed only to a specific group
of persons and not to the general public.

Again, there is no merit in this argument.

The fact that the said circular is addressed only to a specified group, namely
private employment agencies or authority holders, does not take it away
from the ambit of our ruling in Tañada v. Tuvera. In the case of Phil.
Association of Service Exporters v. Torres 29 , the administrative circulars
questioned therein were addressed to an even smaller group, namely
Philippine and Hong Kong agencies engaged in the recruitment of workers
for Hong Kong, and still the Court ruled therein that, for lack of proper
publication, the said circulars may not be enforced or implemented.

Our pronouncement in Tañada v. Tuvera is clear and categorical.

Administrative rules and regulations must be published if their purpose is to
enforce or implement existing law pursuant to a valid delegation., The only
exceptions are interpretative regulations, those merely internal in nature, or
those so-called letters of instructions issued by administrative superiors
concerning the rules and guidelines to be followed by their subordinates in
the performance of their duties. Administrative Circular No. 2, Series of 1983
has not been shown to fall under any of these exceptions.

In this regard, the Solicitor General’s reliance on the case of Yaokasin v.

Commissioner of Customs 30 is misplaced. In the said case, the validity of
certain Customs Memorandum Orders were upheld despite their lack of
publication as they were addressed to a particular class of persons, the
customs collectors, who were also the subordinates of the Commissioner of
the Bureau of Customs. As such, the said Memorandum Orders clearly fall
under one of the exceptions to the publication requirement, namely those
dealing with instructions from an administrative superior to a subordinate
regarding the performance of their duties, a circumstance which does not
obtain in the case at bench.

With respect to the second ground, petitioner would want us to review the
findings of fact of the POEA regarding the two counts of alleged contract
substitution. Again, this is a question of fact which may not be disturbed if
the same is supported by substantial evidence. A reading of the August 29,
1988 Order of the POEA shows that, indeed, the ruling that petitioner is
guilty of two (2) counts of prohibited contract substitution is supported by
substantial evidence. Thus:jgc:chanrobles.com.ph

"2. As admitted by respondent, there was definitely a contract of substitution

in the first count. The first contract was duly approved by the Administration
and, therefore, the parties are bound by the terms and condition thereof
until its expiration. The mere intention of respondents to increase the
number of hours of work, even if there was a corresponding increase in wage
is clear violation of the contract as approved by the Administration, and
notwithstanding the same, the amendment is evidently contrary to law,
morals, good customs and public policy and hence, must be shunned (Art.
1306, Civil Code of the Philippines, Book III, Title I, Chapter 1, Article 83,
Labor Code of the Philippines, as amended). Moreover, it would appear that
the proposed salary increase corresponding to the increase in number of
work bonus may just have been a ploy as complainant were (sic) thereafter
not paid at the increased rate.

As to contract substitution in the second part, a third contract was

emphatically intended by respondent to be signed by complainants which,
however, was not consummated due to the adamant refusal of complainants
to sign thereon. Mere intention of the respondent to commit contract
substitution for a second time should not be left unpunished. It is the duty of
this Office to repress such acts by teaching agencies a lesson to avoid
repetition of the same violation." 31

With respect to the third ground, petitioner argues that the public
respondent committed grave abuse of discretion in holding petitioner liable
for illegal deductions/withholding of salaries considering that the Supreme
Court itself has already absolved petitioner from this charge. Petitioner
premises its argument on the fact that the July 26, 1989 Decision of the
NLRC absolving it from private respondent de Mesa’s claim for salary
deduction has already attained finality by reason of the dismissal of private
respondents’ petition for certiorari of the said NLRC decision by the Supreme
Court.

Petitioner is correct in stating that the July 26, 1989 Decision of the NLRC has
attained finality by reason of the dismissal of the petition
for certiorari assailing the same. However, the said NLRC Decision dealt only
with the money claims of private respondents arising from employer-
employee relations and illegal dismissal and as such, it is only for the
payment of the said money claims that petitioner is absolved. The
administrative sanctions, which are distinct and separate from the money
claims of private respondents, may still be properly imposed by the POEA. In
fact, in the August 31, 1988 Decision of the POEA dealing with the money
claims of private respondents, the POEA Adjudication Office precisely
declared that "respondent’s liability for said money claims is without
prejudice to and independent of its liabilities for the recruitment violations
aspect of the case which is the subject of a separate Order." 32

The NLRC Decision absolving petitioner from paying private respondent de

Mesa’s claim for salary deduction based its ruling on a finding that the said
money claim was not raised in the complaint 33 . While there may be
questions regarding such finding of the NLRC, the finality of the said NLRC
Decision prevents us from modifying or reviewing the same. But the fact that
the claim for salary deduction was not raised by private respondents in their
complaint will not bar the POEA from holding petitioner liable for illegal
deduction or withholding of salaries as a ground for the suspension or
cancellation of petitioner’s license.

Under the POEA Rules and Regulations, the POEA, on its own initiative, may
conduct the necessary proceeding for the suspension or cancellation of the
license of any private placement agency on any of the grounds mentioned
therein. 34 As such, even without a written complaint from an aggrieved
party, the POEA can initiate proceedings against an erring private placement
agency and, if the result of its investigation so warrants, impose the
corresponding administrative sanction thereof. Moreover, the POEA, in an
investigation of an employer-employee relationship case, may still hold a
respondent liable for administrative sanctions if, in the course of its
investigation, violations of recruitment regulations are uncovered. 35 It is
thus clear that even if recruitment violations were not included in a
complaint for money claims initiated by a private complainant, the POEA,
under its rules, may still take cognizance of the same and impose
administrative sanctions if the evidence so warrants.

As such, the fact that petitioner has been absolved by final judgment for the
payment of the money claim to private respondent de Mesa does not mean
that it is likewise absolved from the administrative sanctions which may be
imposed as a result of the unlawful deduction or withholding of private
respondents’ salary. The POEA thus committed no grave abuse of discretion
in finding petitioner administratively liable of one count of unlawful
deduction/withholding of salary.

To summarize, petitioner should be absolved from the three (3) counts of

illegal exaction as POEA Administrative Circular No. 2, Series of 1983 could
not be the basis of administrative sanctions against petitioner for lack of
publication. However, we affirm the ruling of the POEA and the Secretary of
Labor and Employment that petitioner should be held administratively liable
for two (2) counts of contract substitution and one (1) count of withholding or
unlawful deduction of salary.

Under the applicable schedule of penalties imposed by the POEA, the penalty
for each count of contract substitution is suspension of license for two (2)
months or a fine of P10,000.00 while the penalty for withholding or unlawful
deduction of salaries is suspension of license for two (2) months or fine equal
to the salary withheld but not less than P10,000.00 plus restitution of the
amount in both instances 36 . Applying the said schedule on the instant
case, the license of petitioner should be suspended for six (6) months or, in
lieu thereof, it should be ordered to pay fine in the amount of P30,000.00.
Petitioner should likewise pay the amount of SR1,000.00 to private
respondent Vivencio A. de Mesa as restitution for the amount withheld from
his salary.

WHEREFORE, premises considered, the September 13, 1991 and November

25, 1991 Orders of public respondent Secretary of Labor and Employment
are hereby MODIFIED. As modified, the license of private respondent Philsa
International Placement and Services Corporation is hereby suspended for
six (6) months or, in lieu thereof, it is hereby ordered to pay the amount of
P30,000.00 as fine. Petitioner is likewise ordered to pay the amount of
SR1,000.00 to private respondent Vivencio A. de Mesa. All other monetary
awards are deleted.

SO ORDERED.

Melo, Vitug, Panganiban and Sandoval-Gutierrez, JJ., concur

18. CASE DIGEST: LA SUERTE CIGAR & CIGARETTE FACTORY,

Petitioner, vs. COURT OF APPEALS and COMMISSIONER OF INTERNAL
REVENUE, Respondents. (G.R. No. 125346; November 11, 2014)

FACTS:
These cases involve the taxability of stemmed leaf tobacco imported and
locally purchased by cigarette manufacturers for use as raw material in the
manufacture of their cigarettes. Under the Tax Code, if it is to be exported or
to be used in the manufacture of cigars, cigarettes, or other tobacco
products on which the excise tax will eventually be paid on the finished
product.

La Suerte was assessed by the BIR for excise tax deficiency amounting to
more than 34 million pesos. La Suerte protested invoking the Tax Code which
allows the sale of stemmed leaf tobacco as raw material by one
manufacturer directly to another without payment of the excise tax.
However, the CIR insisted that stemmed leaf tobacco is subject to excise tax
"unless there is an express grant of exemption from [the] payment of tax."

La Suerte petitioned for review before the CTA which cancelled the
assessment. The CIR appealed to the CA which reversed the CTA. The CIR
invoked a revenue regulation (RR) which limits the exemption from payment
of specific tax on stemmed leaf tobacco to sales transactions between
manufacturers classified as L-7 permittees.

ISSUES:
[1] Is stemmed leaf tobacco subject to excise (specific) tax?
[2] Is purchase of stemmed leaf tobacco from manufacturers who are not
classified as L-7 permittees subject to tax?
[3] Is the RR valid?
[4] Is the possessor or owner, or importer or exporter, of stemmed leaf
tobacco liable for the payment of specific tax if such tobacco product is
removed from the place of production without payment of said tax?
[5] Does the imposition of excise tax on stemmed leaf tobacco under Section
141 of the 1986 Tax Code constitute double taxation, considering they are
paying the specific tax on the raw material and on the finished product in
which the raw material was a part?

HELD:
[1] Yes, excise taxes on domestic products shall be paid by the manufacturer
or producer before[the] removal [of those products] from the place of
production." "It does not matter to what use the article[s] subject to tax is
put; the excise taxes are still due, even though the articles are removed
merely for storage in someother place and are not actually sold or
consumed.

When tobacco is harvested and processed either by hand or by machine, all

itsproducts become subject to specific tax. Section 141 reveals the
legislative policy to tax all forms of manufactured tobacco — in contrast to
raw tobacco leaves — including tobacco refuse or all other tobacco which
has been cut, split, twisted, or pressed and is capable of being smoked
without further industrial processing.

Stemmed leaf tobacco is subject to the specific tax under Section 141(b). It
is a partially prepared tobacco. The removal of the stem or midrib from the
leaf tobacco makes the resulting stemmed leaf tobacco a prepared or
partially prepared tobacco.

Despite the differing definitions for "stemmed leaf tobacco" under revenue
regulations, the onus of proving that stemmed leaf tobacco is not subject to
the specific tax lies with the cigarette manufacturers. Taxation is the rule,
exemption is the exception.

[2] Stemmed leaf tobacco transferred in bulk between cigarette

manufacturers are exempt from excise tax under the Tax Code vis-a-vis RRs.

Section 137 authorizes a tax exemption subject to the following: (1) that the
stemmed leaf tobacco is sold in bulk as raw material by one manufacturer
directly to another; and (2) that the sale or transfer has complied with the
conditions prescribed by the Department of Finance.

The conditions under which stemmed leaf tobacco may be transferred from
one factory to another without prepayment of specific tax are as follows: (a)
The transfer shall be under an official L-7 invoice on which shall be entered
the exact weight of the tobacco at the time of its removal; (b) Entry shall be
made in the L-7 register in the place provided on the page for removals; and
(c) Corresponding debit entry shall bemade in the L-7 register book of the
factory receiving the tobacco under the heading, "Refuse, etc.,received from
the other factory," showing the date of receipt, assessment and invoice
numbers, name and address of the consignor, formin which received, and
the weight of the tobacco.

[3] Yes, valid. Under Section 3(h) of RR No. 17-67, entities that were issued
by the Bureau of Internal Revenue with an L-7 permit refer to "manufacturers
of tobacco products." Hence, the transferor and transferee of the stemmed
leaf tobacco must be an L-7 tobacco manufacturer.

The reason behind the tax exemption of stemmed leaf tobacco transferred
between two L-7 manufacturers is that the same had already been
previously-taxed when acquired by the L-7 manufacturer from dealers of
tobacco. There is no new product when stemmed leaf tobacco is transferred
between two L-7 permit holders. Thus, there can be no excise tax that will
attach. The regulation, therefore, is reasonable and does not create a new
statutory right.

Moreover, although delegation is not allowed as a rule, the power to fill in

the details and manner as to the enforcement and administration of a law
may be delegated to various specialized administrative agencies.

[4] Importation of stemmed leaf tobacco not included in the exemption. The

transaction contemplated in Section 137 does not include importation of
stemmed leaf tobacco for the reason that the law uses the word "sold" to
describe the transaction of transferring the raw materials from one
manufacturer to another.

[5] In this case, there is no double taxation in the prohibited sense because
the specific tax is imposed by explicit provisions of the Tax Code on two
different articles or products: (1) on the stemmed leaf tobacco; and (2) on
cigar or cigarette.

19. Equi-Asia Placement, Inc. v. Department of Foreign Affairs and

Department of Labor and Employment
GR 152214 September 19, 2006

OFW Manny dela Rosa Razon died of ied of acute cardiac arrest while asleep
at the dormitory of the Samsong Textile Processing Factory in South Korea.
As a result thereof, the OWWA requested petitioner Equi-Asia, the agency
responsible for Razon’s recruitment and deployment, to provide for Prepaid
Ticket Advice (PTA) and assistance for the repatriation of Razon’s remains.
Equi-Asia denied responsibility for providing such assistance arguing that
Razon violated his employment contract by unlawfully escaping from his
company assignment without prior authorization. In lieu of such assistance, it
suggested that Razon’s relatives can avail of the benefits provided for by
OWWA in cases involving undocumented/illegal Filipino workers abroad.
OWWA, in response to petitioner’s denials, invoked Sections 52 to 55 of the
Implementing Rules Governing RA 8042 1 provding that “the repatriation of
OFW, his/her remains and transport of his personal effects is the primary
responsibility of the principal or agency and to immediately advance the cost
of plane farewithout prior determination of the cause of worker's
repatriation”. In consequence thereof, Equi-Asia filed a petition for certiorari
with the Court of Appeals questioning the legality and constitutionality of
said provisions in the implementing rules on the ground that it expanded
Section 15 of RA 8042. It contends thus - Sec. 15 2 of R.A. 8042 clearly
contemplates prior notice and hearing before responsibility thereunder could
be established against the agency that sets up the defense of sole fault in
avoidance of said responsibility -.Besides, the sections in question unduly
grant the powers to require advance payment of the plane fare, to impose
the corresponding penalty of suspension in case of non-compliance
therewith, within 48 hours and to recover said advance payment from the
dead worker's estate upon the return of his remains to the country before
the NLRC, when the law itself does not expressly provide for the grant of
such powers.

Issue: Whether or not Sections 52, 53, 54 and 55 of the Omnibus Rules and
Regulations Implementing RA 8042, issued by DFA and POEA, is illegal and/or
violative of due process such that POEA acted without or in excess of its
jurisdiction and/or in grave abuse of discretion in issuing said order to pay
said expenses.

Held: The petition of the petitioner should be dismissed on the following

grounds:
(1)[Procedural] For a petition for certiorari to prosper, the writ must be
directed against a tribunal, a board or an officer exercising judicial or quasi-
judicial functions. Citing Abella, Jr. v. Civil Service Commission, the Court
prefatorily defined and distinguished between quasi-judicial and quasi-
legislative powers exercised by administrative agencies. In exercising its
quasi-judicial function, an administrative body adjudicates the rights of
1
Migrant Workers and Overseas Filipino Act of 1995
2
The repatriation of the worker and the transport of his personal belongings shall be the primary responsibility of the agency which, recruited
or deployed the worker overseas.All costs attendant to repatriation shall be borne by or charged to the agency concerned and/or its
principal.Likewise, the repatriation of remains and transport of the personal belongings of a deceased worker and all costs attendant thereto
shall be borne by the principal and/or the local agency.However, in cases where the termination of employment is due solely to the fault of the
worker, the principal/employer or agency shall not in any manner be responsible for the repatriation of the former and/or his belongings.
persons before it, in accordance with the standards laid down by the law. The
determination of facts and the applicable law, as basis for official action and
the exercise of judicial discretion, are essential for the performance of this
function. On these considerations, it is elementary that due process
requirements, must be observed. Other hand, quasi-legislative power is
exercised by administrative agencies through the promulgation of rules and
regulations within the confines of the granting statute and the doctrine of
non-delegation of certain powers flowing from the separation of the great
branches of the government. Prior notice to and hearing of every affected
party, as elements of due process, are not required since there is no
determination of past events or facts that have to be established or
ascertained. In this case, petitioner assails certain provisions of the Omnibus
Rules. However, these rules were clearly promulgated by respondents
Department of Foreign Affairs and Department of Labor and Employment in
the exercise of their quasi-legislative powers or the authority to promulgate
rules and regulations. Because of this, petitioner was, thus, mistaken in
availing himself of the remedy of an original action for certiorari as
obviously, only judicial or quasi-judicial acts are proper subjects thereof.
(2) [Delegation of Administrative functions; Rationale] It is now well-
settled that delegation of legislative power to various specialized
administrative agencies is allowed in the face of increasing complexity of
modern life. Given the volume and variety of interactions involving the
members of today's society, it is doubtful if the legislature can promulgate
laws dealing with the minutiae aspects of everyday life. Hence, the need to
delegate to administrative bodies, as the principal agencies tasked to
execute laws with respect to their specialized fields, the authority to
promulgate rules and regulations to implement a given statute and
effectuate its policies. All that is required for the valid exercise of this power
of subordinate legislation is that the regulation must be germane to the
objects and purposes of the law; and that the regulation be not in
contradiction to, but in conformity with, the standards prescribed by the law.
Under the first test or the so-called completeness test, the law must be
complete in all its terms and conditions when it leaves the legislature such
that when it reaches the delegate, the only thing he will have to do is to
enforce it. The second test or the sufficient standard test, mandates that
there should be adequate guidelines or limitations in the law to determine
the boundaries of the delegate's authority and prevent the delegation from
running riot.

(3) [Compliance with test of delegation] Section 53 of the Omnibus Rules

is not invalid for contravening Section 15 of the law which states that a
placement agency shall not be responsible for a worker's repatriation should
the termination of the employer-employee relationship be due to the fault of
the OFW. The statute merely states the general principle that in case the
severance of the employment was because of the OFW's own undoing, it is
only fair that he or she should shoulder the costs of his or her homecoming.
Section 15 of Republic Act No. 8042, however, certainly does not preclude a
placement agency from establishing the circumstances surrounding
an OFW's dismissal from service in an appropriate proceeding. As such
determination would most likely take some time, it is only proper that an
OFW be brought back here in our country at the soonest possible time lest
he remains stranded in a foreign land during the whole time that recruitment
agency contests its liability for repatriation. Repatriation is in effect an
unconditional responsibility of the agency and/or its principal that cannot be
delayed by an investigation of why the worker was terminated from
employment. To be left stranded in a foreign land without the financial
means to return home and being at the mercy of unscrupulous individuals is
a violation of the OFW's dignity and his human rights. These are the same
rights R.A. No. 8042 seeks to protect.

20. TOLEDO V CSC and COMELEC

Facts:
Atty. Augusto Toledo was appointed by then Comelec Chairman Ramon
Felipe as Manager of the Education and Information Department of the
Comelec on May 1986, at which time Toledo was already more than 57 years
old. Toledo’s appointment papers and his oath of office were endorsed by the
Comelec to the CSC on June 1986 for approval and attestation. However, no
prior request for exemption from the provisions of Section 22, Rule III of
the CSRPAP—which prohibits the appointment of persons 57 years old or
above into government service without prior CSC approval—was secured.
Petitioner then reported for work.
Comelec, upon discovery of the lack of authority required under CSRPAP, and
CSC Memo Circular 5 issued Resolution No. 2066, which declared void
from the beginning Toledo’s appointment. Petitioner appealed to CSC, which
considered him a de facto officer and his appointment voidable, and moved
for reconsideration but was denied, hence the present petition for certiorari.
Issue:
W/N CSRPAP provision is valid

Held:
No. The Civil Service Act of 959 (RA 2260), which established the CSC,
contained no provision prohibiting appointment or reinstatement into
government service of any person already 57 years old. Sec 5 Rule 6 of the
Revised Civil Service Rules, which prohibits such, was purely the creation of
CSC.
Marcos’s PD 807 (Civil Service Decree), which established a new CSC and
superseded RA 2260, also provided that rules and regulations shall become
effective only 30 days after publication in the OG or in any newspaper of
general circulation. The new CSC adopted the CSRPAP . No provision re
prohibition of appointment of 57 year old made in PD 807; prohibition was
purely created by CSC.
The provision cannot be valid, being entirely a CSC creation, it has no basis
in the law which it was meant to implement. It cannot be justified as a valid
exercise of its function of promulgating rules and regulations for that
function, to repeat, may legitimately be exercised only for the purpose of
carrying the provisions of the law into effect; and since there is no
prohibition or restriction on the employment of 57-year old persons in the
statute—or any provision respecting age as a factor in employment—there
was nothing to carry into effect through an implementing rule on the matter.
The power vested in the CSC was to implement the law or put it into effect,
not to add to it; to carry the law into effect or execution, not to supply
perceived omissions in it.

Additionally, the CSRPAP cannot be considered effective as of the time of the

application to Toledo of a provision thereof, for the reason that said rules
were never published as required by both RA 2260 and PD 807. The
argument that it was a “mere reiteration of existing law” and “circularized”
cannot stand as formerly discussed.

Also, Toledo’s separation from service was through no fault of his

own. Petition granted.

21. G.R. No. L-43653 November 29, 1977

RADIO COMMUNICATIONS OF THE PHILIPPINES, INC.

(RCPI), petitioner,
vs.
BOARD OF COMMUNICATIONS and DIEGO MORALES, respondents.

G.R. No. L-45378 November 29, 1977

RADIO COMMUNICATIONS OF THE PHILIPPINES. INC.

(RCPI), petitioner,

vs.

BOARD OF COMMUNICATIONS and PACIFICO

INNOCENCIO, respondents.
Treñas & Aligaen for petitioner.

R. Mag. Bernardo for respondent Morales.

Silvestre T. de la Cruz for respondent Innocencio.

Primitivo C. Santos for respondent Board.

MARTIN, J.,

These two petitions (G.R. No. L-43653 and G.R. No. L-45378) for review by
certiorari of the decisions of the Board of Communications in BC Case No. 75-
01-OC, entitled "Diego T Morales vs. Radio Communications of the
Philippines, Inc. (RCPI)" and BC Case No. 75-08-OC, entitled "Pacifica
Innocencio vs. Radio Communications of the Philippines, Inc. (RCPI)," have
been Consolidated as per resolution of this Court dated March 21, 1977, as
they involve the same issue as to whether the Board of Communications has
jurisdiction over claims for damages allegedly suffered by private
respondents for failure to receive telegrams sent thru the petitioner Radio
Communications of the Philippines, Inc., RCPI for short.

In BC Case No. 75-01-OC (G.R. No. L-43653) complainant respondent Diego

Morales claims that while he was in Manila his daughter sent him a telegram
on October 15, 1974 from Santiago, Isabela, informing him of the death of
his wife, Mrs. Diego T. Morales. The telegram sent thru the petitioner RCPI
however never reached him. He had to be informed personally about the
death of his wife and so to catch up with the burial of his wife, he had to take
the trip by airplane to Isabela. In its answer petitioner RCPI claims that the
telegram sent by respondent was transmitted from Santiago, lsabela to its
Message Center at Cubao, Quezon City but when it was relayed from Cubao,
the radio signal became intermittent making the copy received at Sta. Cruz,
Manila unreadable and unintelligible. Because of the failure of the RCPI to
transmit said telegram to him, respondent allegedly suffered inconvenience
and additional expenses and prays for damages.

In BC Case No. 75-08-OC (G.R. No. L-45378) complainant respondent Pacifico

Innocencio claim that on July 13, 1975 Lourdes Innocencio sent a telegram
from Paniqui, Tarlac, thru the facilities of the petitioner RCPI to him at Barrio
Lomot, Cavinti, Laguna for the Purpose of informing him about the death of
their father. The telegram was never received by Pacifico Innocencio. Inspite
of the non-receipt and/or non-delivery of the message sent to said address,
the sender (Lourdes Innocencio has not been notified about its non-delivery,
As a consequence Pacifica Innocencio was not able to attend the internment
of their father at Moncada, Tarlac. Because of the failure of RCPI to deliver to
him said telegram he allegedly was "shocked when he learned about the
death of their father when he visited his hometown Moncada Tarlac on
August 14, 1975," and thus suffered mental anguish and personal
inconveniences. Likewise, he prays for damages.

After hearing. the respondent Board in both cases held that the service
rendered by petitioner was inadequate and unsatisfactory and imposed upon
the petitioner in each case a disciplinary fine of P200 pursuant to Section 21
of Commonwealth Act 146, as amended, by Presidential Decree No. I and
Letter of Implementation No. 1.

The main thrust of the argument of petitioner is that respondent Board has
no jurisdiction to entertain and take cognizance of complaints for injury
caused by breach of contractual obligation arising from negligence covered
by Article 1170 of the Civil Code 1 and injury caused by quasi delict or tort
liability under Article 2176 of the Civil Code 2 which according to it should be
ventilated in the proper courts of justice and not in the Board of
Communications.

We agree with petitioner RCPI. In one case We have ruled that the Public
Service Commission and its successor in interest, the Board of
Communications, "being a creature of the legislature and not a court, can
exercise only such jurisdiction and powers as are expressly or by necessary
implication,. conferred upon it by statute". 3 The functions of the Public
Service Commission are limited and administrative in nature and it has only
jurisdiction and power as are expressly or by necessary implication conferred
upon it by statute. 4 As successor in interest of the Public Service
Commission, the Board of Communications exercises the same powers
jurisdiction and functions as that provided for in the Public Service Act for the
Public Service Commission. One of these powers as provided under Section
129 of the Public Service Act governing the organization of the Specialized
Regulatory Board, is to issue certificate of public convenience. But this power
to issue certificate of public convenience does not carry with it the power of
supervision and control over matters not related to the issuance of
certificate of public convenience or in the performance therewith in a
manner suitable to promote public interest. But even assuming that the
respondent Board of Communications has the power or jurisdiction over
petitioner in the exercise of its supervision to insure adequate public service,
petitioner cannot be subjected to payment of fine under Section 21 of the
Public Service Act, because this provision of the law subjects to a fine every
public service that violates or falls to comply with the terms and conditions
of any certificate or any orders, decisions or regulations of the Commission.
In the two cases before us petitioner is not being charged nor investigated
for violation of the terms and conditions of its certificate of public
convenience or of any order, decision or regulations of the respondent Board
of Communications. The complaint of respondents in the two case was that
they were allegedly inconvenienced or injured by the failure of the petitioner
to transmit to them telegrams informing them of the deaths of close
relatives which according to them constitute breach of contractual obligation
through negligence under the Civil Code. The charges however, do not
necessarily involve petitioners failure to comply with its certificate of public
convenience or any order, decision or regulation of respondent Board of
Communication. It is clear from the record that petitioner has not been
charge of any violation or failure to comply with the terms and condition of
its certificates of public convenience or of any order, decision or regulation of
the respondent Board. The charge does not relate to the management of the
facilities and system of transmission of messages by petitioner in accordance
with its certificate of public convenience. If in the two cases before Us
complainants Diego Morales and Pacifica Innocencio allegedly suffered injury
due to petitioner's breach of contractual obligation arising from negligence,
the proper forum for them to ventilate their grievances for possible recovery
of damages against petitioner should be in the courts and not in the
respondent Board of Communications. Much less can it impose the
disciplinary fine of P200 upon the petitioner. In Francisco Santiago vs. RCPI
(G.R. No. L-29236) and Constancio Langan vs. RCPI (G.R. No. L-29247), this
Court speaking thru Justice Enrique Fernando, ruled:

There can be no justification then for the Public Service

Commission (now the Board of Communications as successor in
interest) imposing the fines in these two petitions. The law
cannot be any clearer . The only power it possessed over radio
companies as noted was to fix rates It could not take to task a
radio company for an negligence or misfeasance. It was not
vested with such authority. That it did then in these two petitions
lacked the impress of validity.

In the face of the provision itself, it is rather apparent that the

Public Service Commission lacked the required power to proceed
against petitioner. There is nothing in Section 21 thereof which
empowers it to impose a fine that calls for a different conclusion.

WHEREFORE. both decisions of respondent Board of Communications in BC

Case No. 75-01 OC and BC Case No. 75- 08-0C are hereby reversed, set
aside, declared null and void for lack of jurisdiction to take cognizance of
both cases. Without costs.

SO ORDERED.

22. G.R. No. 84811 August 29, 1989

SOLID HOMES, INC., petitioner,
vs.
TERESITA PAYAWAL and COURT OF APPEALS, respondents.

CRUZ, J.:

We are asked to reverse a decision of the Court of Appeals sustaining the

jurisdiction of the Regional Trial Court of Quezon City over a complaint filed
by a buyer, the herein private respondent, against the petitioner, for delivery
of title to a subdivision lot. The position of the petitioner, the defendant in
that action, is that the decision of the trial court is null and void ab
initio because the case should have been heard and decided by what is now
called the Housing and Land Use Regulatory Board.

The complaint was filed on August 31, 1982, by Teresita Payawal against
Solid Homes, Inc. before the Regional Trial Court of Quezon City and
docketed as Civil Case No. Q-36119. The plaintiff alleged that the defendant
contracted to sell to her a subdivision lot in Marikina on June 9, 1975, for the
agreed price of P 28,080.00, and that by September 10, 1981, she had
already paid the defendant the total amount of P 38,949.87 in monthly
installments and interests. Solid Homes subsequently executed a deed of
sale over the land but failed to deliver the corresponding certificate of title
despite her repeated demands because, as it appeared later, the defendant
had mortgaged the property in bad faith to a financing company. The
plaintiff asked for delivery of the title to the lot or, alternatively, the return of
all the amounts paid by her plus interest. She also claimed moral and
exemplary damages, attorney's fees and the costs of the suit.

Solid Homes moved to dismiss the complaint on the ground that the court
had no jurisdiction, this being vested in the National Housing Authority under
PD No. 957. The motion was denied. The defendant repleaded the objection
in its answer, citing Section 3 of the said decree providing that "the National
Housing Authority shall have exclusive jurisdiction to regulate the real estate
trade and business in accordance with the provisions of this Decree." After
trial, judgment was rendered in favor of the plaintiff and the defendant was
ordered to deliver to her the title to the land or, failing this, to refund to her
the sum of P 38,949.87 plus interest from 1975 and until the full amount was
paid. She was also awarded P 5,000.00 moral damages, P 5,000.00
exemplary damages, P 10,000.00 attorney's fees, and the costs of the suit.1

Solid Homes appealed but the decision was affirmed by the respondent
court, 2 which also berated the appellant for its obvious efforts to evade a
legitimate obligation, including its dilatory tactics during the trial. The
petitioner was also reproved for its "gall" in collecting the further amount of
P 1,238.47 from the plaintiff purportedly for realty taxes and registration
expenses despite its inability to deliver the title to the land.

In holding that the trial court had jurisdiction, the respondent court referred
to Section 41 of PD No. 957 itself providing that:

SEC. 41. Other remedies.-The rights and remedies provided in

this Decree shall be in addition to any and all other rights and
remedies that may be available under existing laws.

and declared that "its clear and unambiguous tenor undermine(d) the
(petitioner's) pretension that the court a quo was bereft of jurisdiction." The
decision also dismissed the contrary opinion of the Secretary of Justice as
impinging on the authority of the courts of justice. While we are disturbed by
the findings of fact of the trial court and the respondent court on the dubious
conduct of the petitioner, we nevertheless must sustain it on the
jurisdictional issue.

The applicable law is PD No. 957, as amended by PD No. 1344, entitled

"Empowering the National Housing Authority to Issue Writs of Execution in
the Enforcement of Its Decisions Under Presidential Decree No. 957." Section
1 of the latter decree provides as follows:

SECTION 1. In the exercise of its function to regulate the real

estate trade and business and in addition to its powers provided
for in Presidential Decree No. 957, the National Housing
Authority shall have exclusive jurisdiction to hear and decide
cases of the following nature:

A. Unsound real estate business practices;

B. Claims involving refund and any other claims filed by

subdivision lot or condominium unit buyer against the project
owner, developer, dealer, broker or salesman; and

C. Cases involving specific performance of contractuala statutory

obligations filed by buyers of subdivision lot or condominium unit
against the owner, developer, dealer, broker or salesman.
(Emphasis supplied.)

The language of this section, especially the italicized portions, leaves no

room for doubt that "exclusive jurisdiction" over the case between the
petitioner and the private respondent is vested not in the Regional Trial
Court but in the National Housing Authority. 3
The private respondent contends that the applicable law is BP No. 129, which
confers on regional trial courts jurisdiction to hear and decide cases
mentioned in its Section 19, reading in part as follows:

SEC. 19. Jurisdiction in civil cases.-Regional Trial Courts shall

exercise exclusive original jurisdiction:

(1) In all civil actions in which the subject of the litigation is

incapable of pecuniary estimation;

(2) In all civil actions which involve the title to, or possession of,
real property, or any interest therein, except actions for forcible
entry into and unlawful detainer of lands or buildings, original
jurisdiction over which is conferred upon Metropolitan Trial
Courts, Municipal Trial Courts, and Municipal Circuit Trial Courts;

xxx xxx xxx

(8) In all other cases in which the demand, exclusive of interest

and cost or the value of the property in controversy, amounts to
more than twenty thousand pesos (P 20,000.00).

It stresses, additionally, that BP No. 129 should control as the later

enactment, having been promulgated in 1981, after PD No. 957 was issued
in 1975 and PD No. 1344 in 1978.

This construction must yield to the familiar canon that in case of conflict
between a general law and a special law, the latter must prevail regardless
of the dates of their enactment. Thus, it has been held that-

The fact that one law is special and the other general creates a
presumption that the special act is to be considered as
remaining an exception of the general act, one as a general law
of the land and the other as the law of the particular case. 4

xxx xxx xxx

The circumstance that the special law is passed before or after

the general act does not change the principle. Where the special
law is later, it will be regarded as an exception to, or a
qualification of, the prior general act; and where the general act
is later, the special statute will be construed as remaining an
exception to its terms, unless repealed expressly or by necessary
implication. 5
It is obvious that the general law in this case is BP No. 129 and PD No. 1344
the special law.

The argument that the trial court could also assume jurisdiction because of
Section 41 of PD No. 957, earlier quoted, is also unacceptable. We do not
read that provision as vesting concurrent jurisdiction on the Regional Trial
Court and the Board over the complaint mentioned in PD No. 1344 if only
because grants of power are not to be lightly inferred or merely implied. The
only purpose of this section, as we see it, is to reserve. to the aggrieved
party such other remedies as may be provided by existing law, like a
prosecution for the act complained of under the Revised Penal Code. 6

On the competence of the Board to award damages, we find that this is part
of the exclusive power conferred upon it by PD No. 1344 to hear and decide
"claims involving refund and any other claims filed by subdivision lot or
condominium unit buyers against the project owner, developer, dealer,
broker or salesman." It was therefore erroneous for the respondent to brush
aside the well-taken opinion of the Secretary of Justice that-

Such claim for damages which the subdivision/condominium

buyer may have against the owner, developer, dealer or
salesman, being a necessary consequence of an adjudication of
liability for non-performance of contractual or statutory
obligation, may be deemed necessarily included in the phrase
"claims involving refund and any other claims" used in the
aforequoted subparagraph C of Section 1 of PD No. 1344. The
phrase "any other claims" is, we believe, sufficiently broad to
include any and all claims which are incidental to or a necessary
consequence of the claims/cases specifically included in the
grant of jurisdiction to the National Housing Authority under the
subject provisions.

The same may be said with respect to claims for attorney's fees
which are recoverable either by agreement of the parties or
pursuant to Art. 2208 of the Civil Code (1) when exemplary
damages are awarded and (2) where the defendant acted in
gross and evident bad faith in refusing to satisfy the plaintiff 's
plainly valid, just and demandable claim.

xxx xxx xxx

Besides, a strict construction of the subject provisions of PD No.

1344 which would deny the HSRC the authority to adjudicate
claims for damages and for damages and for attorney's fees
would result in multiplicity of suits in that the subdivision
condominium buyer who wins a case in the HSRC and who is
 thereby deemed entitled to claim damages and attorney's fees
would be forced to litigate in the regular courts for the purpose,
a situation which is obviously not in the contemplation of the law.
(Emphasis supplied.)7

As a result of the growing complexity of the modern society, it has become

necessary to create more and more administrative bodies to help in the
regulation of its ramified activities. Specialized in the particular fields
assigned to them, they can deal with the problems thereof with more
expertise and dispatch than can be expected from the legislature or the
courts of justice. This is the reason for the increasing vesture of quasi-
legislative and quasi-judicial powers in what is now not unreasonably called
the fourth department of the government.

Statutes conferring powers on their administrative agencies must be liberally

construed to enable them to discharge their assigned duties in accordance
with the legislative purpose. 8 Following this policy in Antipolo Realty
Corporation v. National Housing Authority, 9 the Court sustained the
competence of the respondent administrative body, in the exercise of the
exclusive jurisdiction vested in it by PD No. 957 and PD No. 1344, to
determine the rights of the parties under a contract to sell a subdivision lot.

It remains to state that, contrary to the contention of the petitioner, the case
of Tropical Homes v. National Housing Authority 10 is not in point. We upheld
in that case the constitutionality of the procedure for appeal provided for in
PD No. 1344, but we did not rule there that the National Housing Authority
and not the Regional Trial Court had exclusive jurisdiction over the cases
enumerated in Section I of the said decree. That is what we are doing now.

It is settled that any decision rendered without jurisdiction is a total nullity

and may be struck down at any time, even on appeal before this
Court. 11 The only exception is where the party raising the issue is barred by
estoppel, 12 which does not appear in the case before us. On the contrary,
the issue was raised as early as in the motion to dismiss filed in the trial
court by the petitioner, which continued to plead it in its answer and, later,
on appeal to the respondent court. We have no choice, therefore,
notwithstanding the delay this decision will entail, to nullify the proceedings
in the trial court for lack of jurisdiction.

WHEREFORE, the challenged decision of the respondent court is REVERSED

and the decision of the Regional Trial Court of Quezon City in Civil Case No.
Q-36119 is SET ASIDE, without prejudice to the filing of the appropriate
complaint before the Housing and Land Use Regulatory Board. No costs.

SO ORDERED.
Narvasa, Gancayco, Griñ;o-Aquino and Medialdea, JJ., concur.

23. G.R. No. L-12596             July 31, 1958

JOSE L. GUEVARA, petitioner,
vs.
THE COMMISSION ON ELECTIONS, respondent.

Enrique M. Fernando for petitioner.

Dominador D. Dayot for respondent.

BAUTISTA ANGELO, J.:

Petitioner was ordered by the Commissioner on Elections to show cause why

he should not be punished for contempt for having published in the Sunday
Times issue of June 2, 1957 an article entitled "Ballot Boxes Contract Hit",
which tended to interfere with and influence the Commission on Elections
and its members in the adjudication of a controversy then pending
investigation and determination before said body "arising from the third
petition for reconsideration of May 20, 1957 and the supplementary petition
thereof of June 1, 1957 filed by Acme Steel Mfg. Co., Inc., praying for
reconsideration of the resolutions of the Commission of May 4 and 13, 1957,
awarding the contracts for the manufacture and supply of 34,000 ballot
boxes to the National Shipyards & Steel Corporation and the Asiatic Steel
Mfg. Co., Inc. and the respective answers of the latter two corporations to
said petitions; and which article likewise tended to degrade, bring into
disrepute, and undermine the exclusive constitutional function of this
Commission and its Chairman Domingo Imperial and Member Sixto Brillantes
in the administration of all the laws relative to the conduct of elections."

Petitioner, answering summons issued to him by the Commission, appeared

and filed a motion to quash on the following grounds:

a) The Commission has no jurisdiction to punish as contempt the

publication of the alleged contemptuous article, as neither in the
Constitution nor in statutes is the Commission granted a power to so
punish the same, for should Section 5 of Republic Act No. 180, vesting
the Commission with "power to punish contempts provided for in Rule
of the Court under the same procedure and with the same penalties
provided therein," be applied to the case at hand, said provision would
be unconstitutional.

b) Assuming that the Commission's power to punish contempt exists,

the same cannot be applied to the instant case, where the Commission
is exercising a purely administrative function for purchasing ballot
boxes.
 c) Assuming that the Commission's power to punish contempt exists,
said power cannot apply to the present case because the matter of
purchasing the ballot boxes was already a closed case when the article
in question was published.

d) Assuming that controversy contemplated by the law was still

pending, the article in question was a fair report because it could be
assumed that the news report of the respondent was based on the
motion for reconsideration filed by the Acme Steel where there was an
allegation of fraud, etc.

The Commission, after hearing, denied the motion to quash but granted
petitioner a period of fifteen (15) days within which to elevate the matter to
the Supreme Court in view of the issue raised which assails the jurisdiction of
the Commission to investigate and punish petitioner for contempt in
connection with the alleged publication. Hence the present petition for
prohibition with preliminary injunction.

The facts which gave rise to the present contemptuous incident are: The
Commission on Elections, on May 4, 1957, after proper negotiations,
awarded to the National Shipyards & Steel Corporation (NASSCO), the Acme
Steel Mfg. Co., Inc. (ACME), and the Asiatic Steel Mfg. Co., Inc. (ASIATIC), the
contracts to manufacture and supply the Commission 12,000, 11,000 and
11,000 ballot boxes at P17.64, P14.00, and P17.00 each, respectively. On
May 8, 1957, both the NASSCO and the ASIATIC signed with the Commission
on Elections the corresponding contracts thereon. On May 13, 1957, the
Commission cancelled the award to the ACME for failure of the latter to sign
the contract within the designated time and awarded to the NASSCO and the
ASIATIC, one-half each, the 11,000 ballot boxes originally alloted to the
ACME. The corresponding contracts thereon were signed on May 16, 1957.

Then followed a series of petitions filed by the ACME for the reconsideration
of the resolution of the Commission of May 13, 1957. The first of these
petitions was filed on May 14, 1957 which, after hearing, was denied by the
Commission in its resolution of May 16, 1957. The second petition was filed
on May 16, 1957 and was denied on May 17, 1957. The third petition was
filed on May 20, 1957, and because of the seriousness of the grounds alleged
therein for the annulment of its previous resolutions, the Commission
resolved to conduct a formal investigation on the matter ordering the
NASSCO and the ASIATIC to file their respective answers. Thereafter, after
these corporations had filed their answers, the Commission held a formal
hearing thereon on May 24, 1957. On May 28, 1957, the ACME filed a
memorandum on the points adduced during the hearing, and on June 4,
1957, the Commission issued its resolution denying the third motion for
reconsideration. The article signed by petitioner was published in the June 2,
1957 issue of the Sunday Times, a newspaper of nation-wide circulation.
The question to be determined is whether the Commission on Elections has
the power and jurisdiction to conduct contempt proceedings against
petitioner with a view to imposing upon him the necessary disciplinary
penalty in connection with the publication of an article in the Sunday Times
issue of June 2, 1957 which, according to the charge, tended to interfere with
and influence said Commission in the adjudication of a controversy then
pending determination and to degrade and undermine the function of the
Commission and its members in the administration of all laws relative to the
conduct of elections.

The Commission on Elections is an independent administrative body which

was established by our Constitution to take charge of the enforcement of all
laws relative to the conduct of elections and devise means and methods that
will insure the accomplishment of free, orderly, and honest elections
(Sumulong vs. Commission on Elections, 73 Phil., 288; Nacionalista Party vs.
The Solicitor General, 85 Phil., 101; 47 Off. Gaz. 2356). Its powers are
defined in the Constitution. It provides that it "shall have exclusive charge of
the enforcement and administration of all laws relative to the conduct of
elections and shall exercise all other functions which may be conferred upon
it by law. It shall decide, save those involving the right to vote, all
administrative questions, affecting elections, including the determination of
the number and location of polling places, and the appointment of election
inspectors and of other election officials" (Section 2, Article X). The Revised
Election Code supplements what other powers may be exercised by said
Commission. Among these powers are those embodied in Section 5 thereof
which, for ready reference, we quote:

SEC. 5. Powers of Commission. — The Commission on Elections or any

of the members thereof shall have the power to summon the parties to
a controversy pending before it, issue subpoenas and subpoenas
duces tecum and otherwise take testimony in any investigation or
hearing pending before it, and delegate such power to any officer. Any
controversy submitted to the Commission on Elections shall be tried,
heard and decided by it within fifteen days counted from the time the
corresponding petition giving rise to said controversy is filed. The
Commission or any of the members thereof shall have the power to
punish contempts provided for in rule sixty-four of the Rules of Court,
under the same procedure and with the same penalties provided
therein.

Any violation of any final and executory decision, order or ruling of the
Commission shall constitute contempt of the Commission.

Any decision, order or ruling of the Commission on Elections may be

reviewed by the Supreme Court by writ of certiorari accordance with
 the Rules of Court or with such rules as may be promulgated by the
Supreme Court.

It would therefore appear that the Commission on Elections not only has the
duty to enforce and administer all laws relative to the conduct of elections
but the power to try, hear and decide any controversy that may be
submitted to it in connection with the elections. And as an incident of this
power, it may also punish for contempt in those cases provided for in Rule 64
of the Rules of Court under the same procedure and with the same penalties
provided therein. In this sense, the Commission, although it cannot be
classified as a court of justice within the meaning of the Constitution (Section
13, Article VIII), for it is merely an independent administrative body (The
Nacionalista Party vs. Vera, 85 Phil., 126; 47 Off. Gaz. 2375), may however
exercise quasi-judicial functions in so far as controversies that by express
provision of the law come under its jurisdiction. As to what question may
come within this category, neither the Constitution nor the Revised Election
Code specifies. The former merely provides that it shall come under its
jurisdiction, saving the right to vote, all administrative questions affecting
elections, including the determination of the number and location of polling
places, and the appointment of election inspectors and other election
officials, while the latter is silent as to what questions may be brought it for
determination. But it is clear that, to come under its jurisdiction, the
questions should be controversial in nature and must refer to the
enforcement and administration of all laws relative to the conduct of
election. The difficulty lies in drawing the demarcation line between a duty
which inherently is administrative in character and a function which is
justiciable and which would therefore call for judicial action by the
Commission. But this much depends upon the factors that may intervene
when a controversy should arise.

Thus, it has been held that the Commission has no power to annul an
election which might not have been free, orderly and honest for such matter
devolves upon other agencies of the Government (Nacionalista Party vs.
Commission on Elections, 85 Phil., 148; 47 Off. Gaz. 2851); neither does it
have the power to decide the validity or invalidity of votes cast in an election
for such devolves upon the courts or the electoral tribunals (Ibid.); it does not
also have the power to order a recounting of the votes before the
proclamation of election even if there are discrepancies in the election
returns for it is a function of our courts of justice (Ramos vs. Commission on
Elections, 80 Phil., 722); nor does it have the power to order the correction of
a certificate of canvass after a candidate had been proclaimed and assumed
office (De Leon vs. Imperial, 94 Phil., 680); and only very recently this Court
has held that the Commission has no power to reject a certificate of
candidacy except only when its purpose is to create confusion in the minds
of the electors (Abcede vs. Imperial, 103 Phil., 136).
On the other hand, it has been held that the Commission has the power to
annul an illegal registry list of voters (Feliciano, et al. vs. Lugay, et al., 93
Phil., 744; 49 Off. Gaz. 3863); to annul an election canvass made by a
municipal board of canvassers (Mintu vs. Enage, et al., G. R. No. L-1834); and
to investigate and act on the illegality of a canvass of election made by a
municipal board of canvassers (Ramos vs. Commission on Elections, 80 Phil.,
722). And as to what are the ministerial duties which the Commission on
Elections must perform in connection with the conduct of elections, the
following resume made by the Commission itself in a controversy which was
submitted to it for determination is very enlightening:

In the enforcement and administration of all laws relative to the

conduct of elections, the first duty of the Commission is to set in
motion all the multifarious preparatory processes ranging from the
purchase of election supplies, printing of election forms and ballots,
appointments of members of the boards of inspectors, establishment
of precincts and designation of polling places to the preparation of the
registry lists of voters, so as to put in readiness on election day the
election machinery in order that the people who are legally qualified to
exercise the right of suffrage may be able to cast their votes to
express their sovereign will. It is incumbent upon the Commission to
see that all these preparatory acts will insure free, orderly and honest
elections. All provisions of the Revised Election Code contain
regulations relative to these processes preparatory for election day. It
is incumbent upon the Commission on Elections to see that all these
preparatory acts are carried out freely, honestly and in an orderly
manner. It is essential that the Commission or its authorized
representatives, in establishing precincts or designating polling places,
must act freely, honestly and in an orderly manner. It is also essential
that the printing of election forms and the purchase of election
supplies and their distribution are done freely, honestly and in an
orderly manner. It is further essential that the political parties or their
duly authorized representatives who are entitled to be represented in
the boards of inspectors must have the freedom to choose the person
who will represent them in each precinct throughout the country. It is
further essential that once organized, the boards of inspectors shall be
given all the opportunity to be able to perform their duties in
accordance with law freely, honestly and in an orderly manner,
individually and as a whole. In other words, it is the duty of the
Commission to see that the boards of inspectors, in all their sessions,
are placed in an atmosphere whereby they can fulfill their duties
without any pressure, influence and interference from any private
person or public official. All these preparatory steps are administrative
in nature and all questions arising therefrom are within the exclusive
powers of the Commission to resolve. All irregularities, anomalies and
misconduct committed by any official in these preparatory steps are
 within the exclusive power of the Commission to correct. Any erring
official must respond to the Commission for investigation. Of these
preparatory acts, the preparation of the permanent list of voters is the
matter involved in this case, which to our mind is completely an
administrative matter. (Decision of the Commission on Elections,
October 28, 1951, In Re Petition of Angel Genuino vs. Prudente, et al.,
Case No. 196)1

Considering that the paramount administrative duty of the Commission is to

set in motion all the multifarious preparatory processes ranging from the
purchase of election supplies, printing of election forms and ballots,
appoinments of members of the board of inspectors, appointment of
precincts and designation of polling preparation of registry lists of voters, so
as to as to put in readiness on election day the election machinery, it may
also be reasonably said that the requisitioning and preparation of the
necessary ballot boxes to be used in the elections is by the same token an
imperative ministerial duty which the Commission is bound to perform if the
elections are to be held. Such is the incident which gave rise to the contempt
case before us. It stems from the ministerial act of the Commission in
requisitioning for the necessary ballot boxes in connection with the last
elections and in so proceeding it provoked a dispute between several dealers
who offered to do the job.

Although the negotiation conducted by the Commission has resulted in

controversy between several dealers, that however merely refers to a
ministerial duty which the Commission has performed in its administrative
capacity in relation to the conduct of elections ordained by our Constitution.
In proceeding on this matter, it only discharged a ministerial duty; it did not
exercise any judicial function. Such being the case, it could not exercise the
power to punish for contempt as postulated in the law, for such power is
inherently judicial in nature. As this Court has aptly said: "The power to
punish for contempt is inherent in all courts; its existence is essential to the
preservation of order in judicial proceedings, and to the enforcement of
judgments, orders and mandates of courts, and, consequently, in the
administration of justice" (Slade Perkins vs. Director of Prisons, 58 Phil., 271;
U. S. vs. Loo Hoe, 36 Phil., 867; In Re Sotto, 46 Off. Gaz. 2570; In Re Kelly, 35
Phil., 944). The exercise of this power has always been regarded as a
necessary incident and attribute of courts (Slade Perkins vs. Director of
Prisons, Ibid.). Its exercise by administrative bodies has been invariably
limited to making effective the power to elicit testimony (People vs. Swena,
296 P., 271). And the exercise of that power by an administrative body in
furtherance of its administrative function has been held invalid
(Langenberg vs. Decker, 31 N.E. 190; In Re Sims 37 P., 135; Roberts vs.
Hacney, 58 S.W., 810). We are therefore persuaded to conclude that the
Commission on Elections has no power nor authority to submit petitioner to
contempt proceedings if its purpose is to discipline him because of the
publication of the article mentioned in the charge under consideration.

Wherefore, petition is granted. Respondent Commission is hereby enjoined

from proceeding with the case set forth in its resolution of June 20, 1957,
with pronouncement as to costs.

The preliminary injunction issued by this Court is made permanent.

Paras, C. J., Padilla, Montemayor, Reyes, A., Reyes, J. B. L., Endencia and
Felix, JJ., concur.

24. G.R. No. 96681 December 2, 1991

HON. ISIDRO CARIÑO, in his capacity as Secretary of the Department

of Education, Culture & Sports, DR. ERLINDA LOLARGA, in her
capacity as Superintendent of City Schools of Manila, petitioners,
vs.
THE COMMISSION ON HUMAN RIGHTS, GRACIANO BUDOY, JULIETA
BABARAN, ELSA IBABAO, HELEN LUPO, AMPARO GONZALES, LUZ DEL
CASTILLO, ELSA REYES and APOLINARIO ESBER, respondents.

NARVASA, J.:

The issue raised in the special civil action of certiorari and prohibition at bar,
instituted by the Solicitor General, may be formulated as follows: where the
relief sought from the Commission on Human Rights by a party in a case
consists of the review and reversal or modification of a decision or order
issued by a court of justice or government agency or official exercising quasi-
judicial functions, may the Commission take cognizance of the case and
grant that relief? Stated otherwise, where a particular subject-matter is
placed by law within the jurisdiction of a court or other government agency
or official for purposes of trial and adjudgment, may the Commission on
Human Rights take cognizance of the same subject-matter for the same
purposes of hearing and adjudication?

The facts narrated in the petition are not denied by the respondents and are
hence taken as substantially correct for purposes of ruling on the legal
questions posed in the present action. These facts, 1 together with others
involved in related cases recently resolved by this Court 2 or otherwise
undisputed on the record, are hereunder set forth.
1. On September 17, 1990, a Monday and a class day, some 800 public
school teachers, among them members of the Manila Public School Teachers
Association (MPSTA) and Alliance of Concerned Teachers (ACT) undertook
what they described as "mass concerted actions" to "dramatize and
highlight" their plight resulting from the alleged failure of the public
authorities to act upon grievances that had time and again been brought to
the latter's attention. According to them they had decided to undertake said
"mass concerted actions" after the protest rally staged at the DECS premises
on September 14, 1990 without disrupting classes as a last call for the
government to negotiate the granting of demands had elicited no response
from the Secretary of Education. The "mass actions" consisted in staying
away from their classes, converging at the Liwasang Bonifacio, gathering in
peaceable assemblies, etc. Through their representatives, the teachers
participating in the mass actions were served with an order of the Secretary
of Education to return to work in 24 hours or face dismissal, and a
memorandum directing the DECS officials concerned to initiate dismissal
proceedings against those who did not comply and to hire their
replacements. Those directives notwithstanding, the mass actions continued
into the week, with more teachers joining in the days that followed. 3
Among those who took part in the "concerted mass actions" were the eight (8) private respondents herein, teachers at the Ramon

Magsaysay High School, Manila, who had agreed to support the non-political demands of the MPSTA. 4

2. For failure to heed the return-to-work order, the CHR complainants (private respondents) were administratively charged on the

basis of the principal's report and given five (5) days to answer the charges. They were also preventively suspended for ninety (90)

days "pursuant to Section 41 of P.D. 807" and temporarily replaced (unmarked CHR Exhibits, Annexes F, G, H). An investigation

committee was consequently formed to hear the charges in accordance with P.D. 807. 5

3. In the administrative case docketed as Case No. DECS 90-082 in which CHR complainants Graciano Budoy, Jr., Julieta Babaran, Luz

 the latter filed separate answers,

del Castillo, Apolinario Esber were, among others, named respondents, 6

opted for a formal investigation, and also moved "for suspension of the
administrative proceedings pending resolution by . . (the Supreme) Court of
their application for issuance of an injunctive writ/temporary restraining
order." But when their motion for suspension was denied by Order dated
November 8, 1990 of the Investigating Committee, which later also denied
their motion for reconsideration orally made at the hearing of November 14,
1990, "the respondents led by their counsel staged a walkout signifying their
intent to boycott the entire proceedings." 7 The case eventually resulted in a
Decision of Secretary Cariño dated December 17, 1990, rendered after
evaluation of the evidence as well as the answers, affidavits and documents
submitted by the respondents, decreeing dismissal from the service of
Apolinario Esber and the suspension for nine (9) months of Babaran, Budoy
and del Castillo. 8
4. In the meantime, the "MPSTA filed a petition for certiorari before the Regional Trial Court of Manila against petitioner (Cariño),

which was dismissed (unmarked CHR Exhibit, Annex I). Later, the MPSTA went to the Supreme Court (on  certiorari, in an attempt to
nullify said dismissal, grounded on the) alleged violation of the striking teachers" right to due process and peaceable assembly

docketed as G.R. No. 95445, supra. The ACT also filed a similar petition before the Supreme Court . . . docketed as G.R. No.

 Both petitions in this Court were filed in behalf of the teacher

95590." 9

associations, a few named individuals, and "other teacher-members so

numerous similarly situated" or "other similarly situated public school
teachers too numerous to be impleaded."

5. In the meantime, too, the respondent teachers submitted sworn

statements dated September 27, 1990 to the Commission on Human Rights
to complain that while they were participating in peaceful mass actions, they
suddenly learned of their replacements as teachers, allegedly without notice
and consequently for reasons completely unknown to them. 10
6. Their complaints — and those of other teachers also "ordered suspended by the . . . (DECS)," all numbering forty-two (42) — were

docketed as "Striking Teachers CHR Case No. 90775." In connection therewith the Commission scheduled a "dialogue" on October

11, 1990, and sent a subpoena to Secretary Cariño requiring his attendance therein. 11

On the day of the "dialogue," although it said that it was "not certain whether he (Sec. Cariño) received the subpoena which was

served at his office, . . . (the) Commission, with the Chairman presiding, and Commissioners Hesiquio R. Mallilin and Narciso C.

Monteiro, proceeded to hear the case;" it heard the complainants' counsel (a) explain that his clients had been "denied due process

and suspended without formal notice, and unjustly, since they did not join the mass leave," and (b) expatiate on the grievances

which were "the cause of the mass leave of MPSTA teachers, (and) with which causes they (CHR complainants)

 The Commission thereafter issued an Order 13 reciting these facts

sympathize." 12

and making the following disposition:

To be properly apprised of the real facts of the case and be accordingly

guided in its investigation and resolution of the matter, considering
that these forty two teachers are now suspended and deprived of their
wages, which they need very badly, Secretary Isidro Cariño, of the
Department of Education, Culture and Sports, Dr. Erlinda Lolarga,
school superintendent of Manila and the Principal of Ramon Magsaysay
High School, Manila, are hereby enjoined to appear and enlighten the
Commission en banc on October 19, 1990 at 11:00 A.M. and to bring
with them any and all documents relevant to the allegations
aforestated herein to assist the Commission in this matter. Otherwise,
the Commission will resolve the complaint on the basis of
complainants' evidence.

x x x           x x x          x x x

7. Through the Office of the Solicitor General, Secretary Cariño sought and
was granted leave to file a motion to dismiss the case. His motion to dismiss
was submitted on November 14, 1990 alleging as grounds therefor, "that the
complaint states no cause of action and that the CHR has no jurisdiction over
the case." 14
8. Pending determination by the Commission of the motion to dismiss, judgments affecting the "striking teachers" were promulgated

in two (2) cases, as aforestated, viz.:

a) The Decision dated December l7, 1990 of Education Secretary Cariño in Case No. DECS 90-082, decreeing dismissal

from the service of Apolinario Esber and the suspension for nine (9) months of Babaran, Budoy and del Castillo; 15 and

b) The joint Resolution of this Court dated August 6, 1991 in G.R. Nos. 95445 and 95590 dismissing the petitions "without

prejudice to any appeals, if still timely, that the individual petitioners may take to the Civil Service Commission on the

matters complained of," 16 and  inter alia "ruling that it was  prima facie lawful for petitioner Cariño to issue return-to-work

orders, file administrative charges against recalcitrants, preventively suspend them, and issue decision on those

charges." 17

9. In an Order dated December 28, 1990, respondent Commission denied Sec. Cariño's motion to dismiss and required him and

Superintendent Lolarga "to submit their counter-affidavits within ten (10) days . . . (after which) the Commission shall proceed to

 It held that the "striking

hear and resolve the case on the merits with or without respondents counter affidavit." 18

teachers" "were denied due process of law; . . . they should not have been
replaced without a chance to reply to the administrative charges;" there had
been a violation of their civil and political rights which the Commission was
empowered to investigate; and while expressing its "utmost respect to the
Supreme Court . . . the facts before . . . (it) are different from those in the
case decided by the Supreme Court" (the reference being unmistakably to
this Court's joint Resolution of August 6, 1991 in G.R. Nos. 95445 and
95590, supra).

It is to invalidate and set aside this Order of December 28, 1990 that the
Solicitor General, in behalf of petitioner Cariño, has commenced the present
action of certiorari and prohibition.

The Commission on Human Rights has made clear its position that it does
not feel bound by this Court's joint Resolution in G.R. Nos. 95445 and
95590, supra. It has also made plain its intention "to hear and resolve the
case (i.e., Striking Teachers HRC Case No. 90-775) on the merits." It intends,
in other words, to try and decide or hear and determine, i.e., exercise
jurisdiction over the following general issues:

1) whether or not the striking teachers were denied due process, and just
cause exists for the imposition of administrative disciplinary sanctions on
them by their superiors; and

2) whether or not the grievances which were "the cause of the mass leave of
MPSTA teachers, (and) with which causes they (CHR complainants)
sympathize," justify their mass action or strike.
The Commission evidently intends to itself adjudicate, that is to say,
determine with character of finality and definiteness, the same issues which
have been passed upon and decided by the Secretary of Education, Culture
& Sports, subject to appeal to the Civil Service Commission, this Court having
in fact, as aforementioned, declared that the teachers affected may take
appeals to the Civil Service Commission on said matters, if still timely.

The threshold question is whether or not the Commission on Human Rights

has the power under the Constitution to do so; whether or not, like a court of
justice, 19 or even a quasi-judicial agency, 20 it has jurisdiction or adjudicatory
powers over, or the power to try and decide, or hear and determine, certain
specific type of cases, like alleged human rights violations involving civil or
political rights.

The Court declares the Commission on Human Rights to have no such power;
and that it was not meant by the fundamental law to be another court or
quasi-judicial agency in this country, or duplicate much less take over the
functions of the latter.

The most that may be conceded to the Commission in the way of

adjudicative power is that it may investigate, i.e., receive evidence and make
findings of fact as regards claimed human rights violations involving civil and
political rights. But fact finding is not adjudication, and cannot be likened to
the judicial function of a court of justice, or even a quasi-judicial agency or
official. The function of receiving evidence and ascertaining therefrom the
facts of a controversy is not a judicial function, properly speaking. To be
considered such, the faculty of receiving evidence and making factual
conclusions in a controversy must be accompanied by the authority
of applying the law to those factual conclusions to the end that the
controversy may be decided or determined authoritatively, finally and
definitively, subject to such appeals or modes of review as may be provided
by law. 21 This function, to repeat, the Commission does not have. 22

The proposition is made clear by the constitutional provisions specifying the powers of the Commission on Human Rights.

 Upon its constitution, it

The Commission was created by the 1987 Constitution as an independent office. 23

succeeded and superseded the Presidential Committee on Human Rights

existing at the time of the effectivity of the Constitution. 24 Its powers and
functions are the following 25
 (1) Investigate, on its own or on complaint by any party, all forms of human rights violations involving civil and political

rights;

(2) Adopt its operational guidelines and rules of procedure, and cite for contempt for violations thereof in accordance with

the Rules of Court;

(3) Provide appropriate legal measures for the protection of human rights of all persons within the Philippines, as well as

Filipinos residing abroad, and provide for preventive measures and legal aid services to the underprivileged whose human

rights have been violated or need protection;

(4) Exercise visitorial powers over jails, prisons, or detention facilities;

(5) Establish a continuing program of research, education, and information to enhance respect for the primacy of human

rights;

(6) Recommend to the Congress effective measures to promote human rights and to provide for compensation to victims

of violations of human rights, or their families;

(7) Monitor the Philippine Government's compliance with international treaty obligations on human rights;

(8) Grant immunity from prosecution to any person whose testimony or whose possession of documents or other evidence

is necessary or convenient to determine the truth in any investigation conducted by it or under its authority;

(9) Request the assistance of any department, bureau, office, or agency in the performance of its functions;

(10) Appoint its officers and employees in accordance with law; and

(11) Perform such other duties and functions as may be provided by law.

As should at once be observed, only the first of the enumerated powers and functions bears any resemblance to adjudication or

adjudgment. The Constitution clearly and categorically grants to the Commission the power to investigate all forms of human rights

violations involving civil and political rights. It can exercise that power on its own initiative or on complaint of any person. It may

exercise that power pursuant to such rules of procedure as it may adopt and, in cases of violations of said rules, cite for contempt in

accordance with the Rules of Court. In the course of any investigation conducted by it or under its authority, it may grant immunity

from prosecution to any person whose testimony or whose possession of documents or other evidence is necessary or convenient to

determine the truth. It may also request the assistance of any department, bureau, office, or agency in the performance of its

functions, in the conduct of its investigation or in extending such remedy as may be required by its findings. 26

But it cannot try and decide cases (or hear and determine causes) as courts of justice, or even quasi-judicial bodies do. To investigate

is not to adjudicate or adjudge. Whether in the popular or the technical sense, these terms have well understood and quite distinct

meanings.
"Investigate," commonly understood, means to examine, explore, inquire or delve or probe into, research on, study. The dictionary

definition of "investigate" is "to observe or study closely: inquire into systematically. "to search or inquire into: . . . to subject to an

 The purpose of investigation, of

official probe . . .: to conduct an official inquiry." 27
course, is to
discover, to find out, to learn, obtain information. Nowhere included or
intimated is the notion of settling, deciding or resolving a controversy
involved in the facts inquired into by application of the law to the facts
established by the inquiry.

The legal meaning of "investigate" is essentially the same: "(t)o follow up

step by step by patient inquiry or observation. To trace or track; to search
into; to examine and inquire into with care and accuracy; to find out by
careful inquisition; examination; the taking of evidence; a legal
inquiry;" 28 "to inquire; to make an investigation," "investigation" being in
turn describe as "(a)n administrative function, the exercise of which
ordinarily does not require a hearing. 2 Am J2d Adm L Sec. 257; . . . an
inquiry, judicial or otherwise, for the discovery and collection of facts
concerning a certain matter or matters." 29
"Adjudicate," commonly or popularly understood, means to adjudge, arbitrate, judge, decide, determine, resolve, rule on, settle. The

dictionary defines the term as "to settle finally (the rights and duties of the parties to a court case) on the merits of issues raised: . . .

 And "adjudge" means "to decide or rule

to pass judgment on: settle judicially: . . . act as judge." 30

upon as a judge or with judicial or quasi-judicial powers: . . . to award or

grant judicially in a case of controversy . . . ." 31
In the legal sense, "adjudicate" means: "To settle in the exercise of judicial authority. To determine finally. Synonymous

with adjudge in its strictest sense;" and "adjudge" means: "To pass on judicially, to decide, settle or decree, or to sentence or

condemn. . . . Implies a judicial determination of a fact, and the entry of a judgment." 32

Hence it is that the Commission on Human Rights, having merely the power "to investigate," cannot and should not "try and resolve

on the merits" (adjudicate) the matters involved in Striking Teachers HRC Case No. 90-775, as it has announced it means to do; and

it cannot do so even if there be a claim that in the administrative disciplinary proceedings against the teachers in question, initiated

and conducted by the DECS, their human rights, or civil or political rights had been transgressed. More particularly, the Commission

has no power to "resolve on the merits" the question of (a) whether or not the mass concerted actions engaged in by the teachers

constitute and are prohibited or otherwise restricted by law; (b) whether or not the act of carrying on and taking part in those

actions, and the failure of the teachers to discontinue those actions, and return to their classes despite the order to this effect by the

Secretary of Education, constitute infractions of relevant rules and regulations warranting administrative disciplinary sanctions, or

are justified by the grievances complained of by them; and (c) what where the particular acts done by each individual teacher and

what sanctions, if any, may properly be imposed for said acts or omissions.

These are matters undoubtedly and clearly within the original jurisdiction of the Secretary of Education, being within the scope of the

disciplinary powers granted to him under the Civil Service Law, and also, within the appellate jurisdiction of the Civil Service

Commission.
  and it
Indeed, the Secretary of Education has, as above narrated, already taken cognizance of the issues and resolved them,  33

appears that appeals have been seasonably taken by the aggrieved parties
to the Civil Service Commission; and even this Court itself has had occasion
to pass upon said issues. 34

Now, it is quite obvious that whether or not the conclusions reached by the Secretary of Education in disciplinary cases are correct

and are adequately based on substantial evidence; whether or not the proceedings themselves are void or defective in not having

accorded the respondents due process; and whether or not the Secretary of Education had in truth committed "human rights

violations involving civil and political rights," are matters which may be passed upon and determined through a motion for

reconsideration addressed to the Secretary Education himself, and in the event of an adverse verdict, may be reviewed by the Civil

Service Commission and eventually the Supreme Court.

The Commission on Human Rights simply has no place in this scheme of things. It has no business intruding into the jurisdiction and

functions of the Education Secretary or the Civil Service Commission. It has no business going over the same ground traversed by the

latter and making its own judgment on the questions involved. This would accord success to what may well have been the

complaining teachers' strategy to abort, frustrate or negate the judgment of the Education Secretary in the administrative cases

against them which they anticipated would be adverse to them.

This cannot be done. It will not be permitted to be done.

In any event, the investigation by the Commission on Human Rights would serve no useful purpose. If its investigation should result

in conclusions contrary to those reached by Secretary Cariño, it would have no power anyway to reverse the Secretary's conclusions.

Reversal thereof can only by done by the Civil Service Commission and lastly by this Court. The only thing the Commission can do, if

it concludes that Secretary Cariño was in error, is to refer the matter to the appropriate Government agency or tribunal for

 It cannot arrogate unto itself the appellate

assistance; that would be the Civil Service Commission. 35

jurisdiction of the Civil Service Commission.

WHEREFORE, the petition is granted; the Order of December 29, 1990 is

ANNULLED and SET ASIDE, and the respondent Commission on Human
Rights and the Chairman and Members thereof are prohibited "to hear and
resolve the case (i.e., Striking Teachers HRC Case No. 90-775) on the
merits."

SO ORDERED.

Melencio-Herrera, Cruz, Feliciano, Bidin, Griño-Aquino, Medialdea, Regalado,

Davide, Jr. and Romero, JJ, concur

25. [G.R. No. 154377. December 8, 2003.]

LAND CAR, INC., Petitioner, v. BACHELOR EXPRESS, INC. AND
VALLACAR TRANSIT, INC., Respondents.

DECISION

VITUG, J.:

On 21 May 1999, petitioner filed with the Regional Office of the Land
Transportation Franchising and Regulatory Board (LTFRB), Region XII, a
verified application to operate a public utility bus service from Davao City to
Cagayan de Oro City via Butuan City.chanrob1es virtua1 1aw 1ibrary

Respondents, themselves grantees of certificates of public convenience,

opposed petitioner’s application alleging that the route applied for was
sufficiently being served by them, and that "cutthroat competition" would
only result if petitioner’s application were to be favorably acted upon.

On 29 October 1999, the LTFRB rendered its decision granting petitioner’s

application and directing the issuance of the corresponding Certificate of
Public Convenience. Respondents’ motion for reconsideration was denied in
the board’s resolution of 27 January 2000. Respondents then appealed to the
Office of the Secretary of the Department of Transportation and
Communication (DOTC). On 05 June 2000, the DOTC Secretary reversed the
decision of the LTFRB. This time, it was petitioner’s turn to move for
reconsideration of the DOTC Secretary’s resolution. The motion, however,
was denied by the DOTC Secretary in his order of 30 August 2000.
Respondents thereupon moved for the immediate implementation by the
LTFRB of the decision of the DOTC Secretary. On 03 October 2000, the LTFRB
granted respondents’ motion and directed petitioner to cease and desist
from operating its buses along the contested route.

On 07 October 2000, petitioner filed a letter-appeal to the Office of the

President seeking to set aside the resolution and order, dated 05 June 2000
and 30 August 2000, respectively, of the DOTC Secretary. Petitioner then
likewise filed before the Court of Appeals a petition for certiorari, docketed
C.A.-G.R. SP No. 61159, questioning the same resolution and order of the
DOTC Secretary subject of the letter-appeal addressed to the Office of the
President. Upon advice of its new counsel, however, petitioner filed a notice
of withdrawal of its petition for certiorari (C.A.-G.R. SP No. 61159) pending
with the appellate court. The appellate court did not act upon the notice of
withdrawal of the petition (C.A. G.R. SP No. 61159) but, instead, dismissed, in
its resolution of 09 November 2000, the petition for failure of compliance
with Section 1, Rule 42, of the 1997 Rules of Civil Procedure on non-forum
shopping.

On 20 October 2000, the Office of the President issued a memorandum

directing that the execution of the resolution and order of the DOTC
Secretary, dated 05 June 2000 and 30 August 2000, respectively, be
meanwhile stayed.

On 15 January 2001, respondents filed with the Court of Appeals a petition

for certiorari under Rule 65 of the 1997 Rules of Civil Procedure, docketed
C.A.-G.R. SP No. 62619, assailing the Memorandum Order of the Office of the
President. Respondents argued that the Office of the President had no
jurisdiction to issue the assailed order in the absence of any law providing for
an appeal from the DOTC to the Office of the President, adding that
petitioner was guilty of forum shopping in addressing a letter-appeal to the
Office of the President.

On 18 June 2001, the Court of Appeals granted respondents’ petition

for certiorari basically on the ground that petitioner was guilty of forum
shopping. It ordered the dismissal of the appeal filed by petitioner before the
Office of the President and reinstated the resolution and order of the DOTC
Secretary enjoining petitioner from operating its buses along the contested
route.chanrob1es virtua1 1aw 1ibrary

In the instant appeal, petitioner contends that the appellate court has
decided a question in a way not in accord with applicable jurisprudence.
There is merit in the petition.

Forum shopping refers to the act of availing oneself of several judicial

remedies in different courts, either simultaneously or successively,
substantially founded on the same transaction and identical material facts
and circumstances, raising basically like issues either pending in, or already
resolved by, some other court. 1 The principle applies not only with respect
to suits filed before courts but also in connection with a litigation
commenced in court while an administrative proceeding is pending in order
to defeat administrative processes in anticipation of an unfavorable
administrative ruling and possibly a favorable court ruling. 2 Forum shopping
is said to exist where the elements of litis pendentia are present or where a
final judgment in one case would amount to res judicata in the other; 3 or
where, in the two or more cases pending, there is identity of (a) parties, (b)
rights or causes of action, and (c) reliefs sought. 4

In order to deter the evils of forum shopping, Circular 28-91, dated 08

February 1994, issued by the Supreme Court requires that every petition
filed with the Supreme Court or the Court of Appeals must be accompanied
by a certification of non-forum shopping. Administrative Circular 04-94, made
effective on 01 April 1994, expands the certification requirement to include
cases filed in court and quasi-judicial agencies below the Supreme Court and
the Court of Appeals. Ultimately, the Court adopted paragraphs (1) and (2) of
Administrative Circular No. 04-94 to become Section 5, Rule 7, of the 1997
Rules of Civil Procedure. Significantly, to curb the malpractice of forum
shopping, the rule ordains that a violation thereof would constitute contempt
of court and be a cause for the summary dismissal of both petitions without
prejudice to the taking of appropriate action against the counsel of the party
concerned. 5

Undeniably, there is identity of cause of action and reliefs sought between

the petitioner’s letter-appeal filed with the Office of the President and the
petition for certiorari filed with the Court of Appeals (C.A. G.R. SP No. 61159).
The DOTC resolution and order, dated 05 June 2000 and 30 August 2000,
respectively, were sought to be set aside in both appeals filed by petitioner.

The doctrine of exhaustion of administrative remedies empowers the Office

of the President to review any determination or disposition of a department
head. The doctrine allows, indeed requires, an administrative decision to first
be appealed to the administrative superiors up to the highest level before it
may be elevated to a court of justice for review. Thus, if a remedy within the
administrative machinery can still be had by giving the administrative officer
concerned every opportunity to decide on the matter that comes within his
jurisdiction, then such remedy should be priorly exhausted before the court’s
judicial power is invoked. 6

The appellate court correctly ruled that the action of a department head
bears only the implied approval of the President, and the latter is not
precluded from exercising the power to review the decision of the former
pursuant to the President’s power of control over all executive departments,
bureaus and offices. 7 The Office of the President validly acquired jurisdiction
over the case upon the filing therewith of the appeal by herein petitioner,
and said jurisdiction is not lost by the subsequent recourse by the petitioner
of the certiorari proceedings before the Court of Appeals. Jurisdiction which
has attached in the first instance continues until the final resolution of the
case. Incongruently, the appellate court, while recognizing to be valid the
exercise of jurisdiction by the Office of the President, ordered the dismissal
of the appeal pending with the said office based on forum shopping.

The decision of the appellate court ordering the dismissal of the appeal taken
to the Office of the President is clearly flawed. It is the latter, not the
appellate court, which could dismiss the case pending before that office. It
also behooves courts of justice, if only for reasons of comity and
convenience, to shy away from a dispute until the system of administrative
redress is completed so as to give the administrative office every opportunity
to correct its error and to properly dispose of the case. In fact, the appellate
court’s order to dismiss the appeal pending with the Office of the President
could well constitute an undue intrusion into a valid exercise of jurisdiction
by the President over acts of subordinates within that office.

WHEREFORE, the petition is GRANTED, and the assailed decision is SET

ASIDE. No costs.chanrob1es virtua1 1aw 1ibrary

SO ORDERED.

Sandoval-Gutierrez, Corona and Carpio Morales, JJ., concur.

26. G.R. No. L-49711 November 7, 1979

ZAMBALES CHROMITE MINING CO., GONZALO P. NAVA, VIOLA S.

NAVA, FEDERICO S. NAVA, PERLA NAVA, HONORATO P. NAVA,
ALEJANDRO S. NAVA, PURIFICACION SISON, A. TORDESILLAS, GUIDO
ADVINCULA, PEDRO ANGULO and TOMAS MARAMBA, petitioners-
appellants,
vs.
COURT OF APPEALS, SECRETARY OF AGRICULTURE AND NATURAL
RESOURCES, DIRECTOR OF MINES, GREGORIO E. MARTINEZ,
ALEJANDRO MENDEZ, NICANOR MARTY, VICENTE MISOLES,
GUILLERMO YABUT, ANDRES R. FIAGOY, MIGUEL A. MANIAGO,
CASIMIRO N. EBIDO, ENRIQUE RIVERA, SEVERINO MIVA, ELENITO B.
MARTINEZ, LUCAS EDURAIN, FELIMON ENCIO, EMILIO ILOCO,
DIOSDADO MISOLA, ERNESTO VALVERDE, PABLO PABILONA,
ARMANDO MINAS, BARTOLOME MARAVE and CECILIO
OOVILLA, respondents-appellees.

Tordesilla & Advincula for petitioners-appellants.

Mariano M. Lozada for private respondents-appellees.

AQUINO, J.:

This is a mining case. The petitioners appealed from the second decision of

the Court of Appeals, reversing its first decision and holding that it was
improper from Benjamin M. Gozon, as Secretary of Agriculture and Natural
Resources, to affirm his own decision as Director of Mines.

The Court of Appeals further held that the trial court's judgment, confirming
the Secretary's decision, should be set aside and that the Minister of Natural
Resources should review anew the decision of the Director of Mines "and,
thereafter, further proceedings will be taken in the trial court". The
antecedental proceedings are as follows:
(1) In Mines Administrative Case No. V-227, Director Gozon issued an order
dated October 5, 1960 wherein he dismissed the case filed by the petitioners
or protestants (Zambales Chromite Mining Co., Inc. or the group of Gonzalo
P. Nava). In that case, they sought to be declared the rightful and prior
locators and possessors of sixty-nine mining claims located in Santa Cruz,
Zambales.

On the basis of petitioners' evidence (the private respondents did not

present any evidence and they filed a demurrer to the evidence or motion to
dismiss the protest), Director Gozon found that the petitioners did not
discover any mineral nor staked and located mining claims in accordance
with law.

In that same order, Director Gozon ruled that the mining claims of the groups
of Gregorio Martinez and Pablo Pabilona, now the private respondents-
appellees, were duly located and registered (pp. 224-231, Record on
Appeal).

(2) The petitioners appealed from that order to the Secretary of Agriculture
and Natural Resources. While the appeal was pending, Director Gozon was
appointed Secretary of Agriculture and Natural Resources. Instead of
inhibiting himself, he decided the appeal, DANR Case No. 2151, on August
16, 1963 as it he was adjudicating the case for the first time. 'Thus,
Secretary Gozon exercised appellate jurisdiction over a case which he had
decided as Director of Mines. He acted as reviewing authority in the appeal
from his own decision. Or, to use another analogy, he acted as trial judge
and appellate judge in the same case.

He ruled that the petitioners had abandoned the disputed mining claims,
while, on the other hand, the Martinez and Pabilona groups had validly
located the said claims. Hence, he dismissed the appeal from his own
decision (pp. 340-341, Record on Appeal).

(3) On September 20, 1963, the petitioners filed a complaint in the Court of
First Instance of Zambales, assailing Secretary Gozon's decision and praying
that they be declared the prior locators and possessors of the sixty-nine
mineral claims in question. Impleaded as defendants in the case were the
Secretary of Agriculture and Natural Resources, the Director of Mines and the
members of the Martinez and Pabilona groups.

After hearing, the lower court sustained Secretary Gozon's decision and
dismissed the case. It held that the disqualification petition of a judge to
review his own decision or ruling (Sec. 1, Rule 137, Rules of Court) does not
apply to administrative bodies; that there is no provision in the Mining Law,
disqualifying the Secretary of Agriculture and Natural Resources from
deciding an appeal from a case which he had decided as Director of Mines;
that delicadeza is not a ground for disqualification; that the petitioners did
not seasonably seek to disqualify Secretary Gozon from deciding their
appeal, and that there was no evidence that the Secretary acted arbitrarily
and with bias, prejudice, animosity or hostility to the petitioners (pp. 386-9,
Record on Appeal).

(4) The petitioners appealed to the Court of Appeals. The Sixth Division of
that Court (Pascual, Agcaoili and Climaco, JJ.) in its decision dated February
15, 1978 reversed the judgment of the trial court and declared that the
petitioners were the rightful locators and possessors of the said sixty-nine
mining claims and held as invalid the mining claims overlapping the same.

That Division found that the petitioners (Nava group) had discovered
minerals and had validly located the said sixty-nine mining claims and that
there was no sufficient basis for Secretary Gozon's finding that the mining
claims of the Martinez and Pabilona groups were validly located.

(5) The defendants, now the private respondents-appellees, filed a motion

for reconsideration based principally on the ground that the Court of Appeals
should have respected the factual findings of the Director of Mines and the
Secretary of Agriculture and Natural Resources on the theory that the facts
found in administrative decisions cannot be disturbed on appeal to the
courts, citing Republic Act No. 4388 which amended section 61 of the Mining
Law effective June 19, 1965; Pajo vs. Ago, 108 Phil. 905; Palanan Lumber &
Plywood Co., Inc. vs. Arranz 65 O.G. 8473; Timbancaya vs. Vicente, 119 Phil.
169, Ortua vs. Singson Encarnacion, 59 Phil. 440.

The defendants-movants prayed that the appeal be dismissed, meaning that

the decisions of the lower court and of Director and Secretary Gozon be
affirmed.

The petitioners opposed that motion for reconsideration. In their opposition,

they reiterated the contention in their brief that Secretary Gozon's decision
was void and, therefore, the factual findings therein are not binding on the
courts.

As already stated, the same Sixth Division (composed of Pascula, Agrava and
Maco, JJ.) in its second decision of October 13, 1978, set aside its first
decision and granted the motion for curiously enough, the first decision was
reconsidered not on the ground advanced by the movants-defendants, now
the private respondents (Martinez and Pabilona groups), which was that the
factual findings of the administrative officials should be upheld, but on the
ground raised in petitioners' opposition, namely, that Secretary Gozon's
decision was void because he was disqualified to review his own decision as
Director of Mines.
So, as already noted, the Court of Appeals in its second decision remanded
the case to the Minister of Natural Resources for another review of Director
Gozon's decision. This was the prayer of the petitioners in their brief but in
their opposition to the motion for reconsideration, they prayed that the first
decision of the Court of Appeals in their favor be maintained.

(6) The second decision did not satisfy the parties. They filed motions for
reconsideration. The petitioners in their motion reiterated their prayer that
the first decision be reinstated. They abandoned their prayer that the case
be returned to the Minister of Natural Resources. On the other hand, the
private respondents in their motion insisted that the trial court's decision be
affirmed on the basis of the factual findings of the Director of Mines and the
Secretary of Agriculture and Natural Resources. The Court of Appeals denied
both motions in its resolutions of December 27, 1978 and January 15, 1979.

Only the petitioners appealed from the second decision of the Court of
Appeals. There is an arresting and noteworthy peculiarity in the present
posture of this case now on appeal to this Court (as arresting and noteworthy
as the peculiarity that Secretary Gozon reviewed his own decision as Director
of Mines),

That twist or peculiarity is that while the petitioners (Nava group) in their
appellants' brief in the Court of Appeals prayed that Secretary Gozon's
decision, alleged to be biased, be declared void and that the case be
returned to the Secretary of Agriculture and Natural Resources for another
review of Director Gozon's order, in their appellants' brief in this Court, they
changed that relief and they now pray that the second decision of the Court
of Appeals, referring this case to the Minister of Natural Resources for
another review, be declared void and that its first decision be affirmed.

In contrast, the private respondents, who did not appeal from the second
decision of the Court of Appeals, instead of sustaining its holding that this
case be referred to the Minister of Natural Resources or instead of defending
that second decision, they being appellees, pray for the affirmance of the
trial court's judgment sustaining the decisions of Director and Secretary
Gozon.

The inconsistent positions of the parties, which were induced by the

contradictory decisions of the Court of Appeals, constitute the peculiar twist
of this case in this Court.

We hold that Secretary Gozon acted with grave abuse of discretion in

reviewing his decision as Director of Mines. The palpably flagrant anomaly of
a Secretary of Agriculture and Natural Resources reviewing his own decision
as Director of Mines is a mockery of administrative justice. The Mining Law,
Commonwealth Act No. 13-i, provides:
 SEC. 61. Conflicts and disputes arising out of mining locations
shall be submitted to the Director of Mines for decision:

Provided, That the decision or order of the Director of Mines may

be appealed to the Secretary of Agriculture and Natural
Resources within thirty days from the date of its receipt.

In case any one of the parties should disagree from the decision
or order of the Director of Mines or of the Secretary of Agriculture
and Natural Resources, the matter may be taken to the court of
competent jurisdiction within thirty days from the receipt of such
decision or order; otherwise the said decision or order shag be
final and binding upon the parties concerned. (As amended by
Republic Act No. 746 approved on June 18,1952).*

Undoubtedly, the provision of section 61 that the decision of the Director of

Mines may be appealed to the Secretary of Agriculture and Natural
Resources contemplates that the Secretary should be a person different from
the Director of Mines.

In order that the review of the decision of a subordinate officer might not
turn out to be a farce the reviewing officer must perforce be other than the
officer whose decision is under review; otherwise, there could be no different
view or there would be no real review of the case. The decision of the
reviewing officer would be a biased view; inevitably, it would be the same
view since being human, he would not admit that he was mistaken in his first
view of the case.

That is the obvious, elementary reason behind the disqualification of a trial

judge, who is promoted to the appellate court, to sit in any case wherein his
decision or ruling is the subject of review (Sec. 1, Rule 137, Rules of Court:
secs. 9 and 27, Judiciary Law).

A sense of proportion and consideration for the fitness of things should have
deterred Secretary Gozon from reviewing his own decision as Director of
Mines. He should have asked his undersecretary to undertake the review.

Petitioners-appellants were deprived of due process, meaning fundamental

fairness, when Secretary Gozon reviewed his own decision as Director of
Mines. (See Amos Treat & Co. vs. Securities and Exchange Commission, 306
F. 2nd 260, 267.)

WHEREFORE, we set aside the order of the Secretary of Agriculture and

Natural Resources dated August 16, 1963 as affirmed by the trial court as
well as the first decision of the Court of Appeals.
We affirm its second decision, returning the case to the Minister of Natural
Resources, with the directive that petitioners' appeal to the Minister be
resolved de novo with the least delay as provided for in Presidential Decree
No. 309, "establishing rules and procedures for the speedy disposition or
settlement of conflicting mining claims".

We reverse the second part of that second decision stating that "thereafter,
further proceedings will be taken in the trial court". That portion is
unwarranted because the trial court does not retain any jurisdiction over the
case once it is remanded to the Minister of Natural Resources. No costs.

SO ORDERED.

Antonio, Santos and Abad Santos, JJ., concur.

Concepcion Jr., J, took no part.

27. G.R. No. 149335. July 1, 2003

EDILLO C. MONTEMAYOR, Petitioner, v. LUIS BUNDALIAN, RONALDO B.

ZAMORA, Executive Secretary, Office of the President, AND GREGORIO R.
VIGILAR, Secretary, Department of Public Works and Highways
(DPWH), respondents.

DECISION

PUNO, J.:

In this petition for review on certiorari, petitioner EDILLO C.

MONTEMAYOR assails the Decision of the Court of Appeals, dated April 18,
2001, affirming the decision of the Office of the President in Administrative
Order No. 12 ordering petitioners dismissal as Regional Director of the
Department of Public Works and Highways (DPWH) for unexplained wealth.

Petitioners dismissal originated from an unverified letter-complaint, dated

July 15, 1995, addressed by private respondent LUIS BUNDALIAN to the
Philippine Consulate General in San Francisco, California, U.S.A. Private
respondent accused petitioner, then OIC-Regional Director, Region III, of the
DPWH, of accumulating unexplained wealth, in violation of Section 8 of
Republic Act No. 3019. Private respondent charged that in 1993, petitioner
and his wife purchased a house and lot at 907 North Bel Aire Drive, Burbank,
Los Angeles, California, making a down payment of US$100,000.00. He
further alleged that petitioners in-laws who were living in California had a
poor credit standing due to a number of debts and they could not have
purchased such an expensive property for petitioner and his wife. Private
respondent accused petitioner of amassing wealth from lahar funds and
other public works projects.

Private respondent attached to his letter-complaint the following documents:

a) a copy of a Grant Deed, dated May 27, 1993, where spouses David and
Judith Tedesco granted the subject property to petitioner and his wife;

b) a copy of the Special Power of Attorney (SPA) executed by petitioner and

his wife in California appointing petitioners sister-in-law Estela D. Fajardo as
their attorney-in-fact, to negotiate and execute all documents and
requirements to complete the purchase of the subject property; and,

c) an excerpt from the newspaper column of Lito A. Catapusan in the Manila

Bulletin, entitled Beatwatch, where it was reported that a low-ranking,
multimillionaire DPWH employee, traveled to Europe and the U.S. with his
family, purchased an expensive house in California, appointed a woman
through an SPA to manage the subject property and had hidden and
unexplained wealth in the Philippines and in the U.S.

Accordingly, the letter-complaint and its attached documents were indorsed

by the Philippine Consulate General of San Francisco, California, to the
Philippine Commission Against Graft and Corruption (PCAGC)[1] for
investigation. Petitioner, represented by counsel, submitted his counter-
affidavit before the PCAGC alleging that the real owner of the subject
property was his sister-in-law Estela Fajardo. Petitioner explained that in
view of the unstable condition of government service in 1991, his wife
inquired from her family in the U.S. about their possible emigration to the
States. They were advised by an immigration lawyer that it would be an
advantage if they had real property in the U.S. Fajardo intimated to them
that she was interested in buying a house and lot in Burbank, California, but
could not do so at that time as there was a provision in her mortgage
contract prohibiting her to purchase another property pending full payment
of a real estate she earlier acquired in Palmdale, Los Angeles. Fajardo offered
to buy the Burbank property and put the title in the names of petitioner and
his wife to support their emigration plans and to enable her at the same time
to circumvent the prohibition in her mortgage contract.

Petitioner likewise pointed out that the charge against him was the subject of
similar cases filed before the Ombudsman.[2] He attached to his counter-
affidavit the Consolidated Investigation Report[3] of the Ombudsman
dismissing similar charges for insufficiency of evidence.
From May 29, 1996 until March 13, 1997, the PCAGC conducted its own
investigation of the complaint. While petitioner participated in the
proceedings and submitted various pleadings and documents through his
counsel, private respondent-complainant could not be located as his
Philippine address could not be ascertained. In the course of the
investigation, the PCAGC repeatedly required petitioner to submit his
Statement of Assets, Liabilities and Net Worth (SALN), Income Tax Returns
(ITRs) and Personal Data Sheet. Petitioner ignored these directives and
submitted only his Service Record. He likewise adduced in evidence the
checks allegedly issued by his sister-in-law to pay for the house and lot in
Burbank, California. When the PCAGC requested the Deputy Ombudsman for
Luzon to furnish it with copies of petitioners SALN from 1992-1994, it was
informed that petitioner failed to file his SALN for those years.

After the investigation, the PCAGC, in its Report to the Office of the
President, made the following findings: Petitioner purchased a house and lot
in Burbank, California, for US$195,000.00 (or P3.9M at the exchange rate
prevailing in 1993). The sale was evidenced by a Grant Deed. The PCAGC
concluded that the petitioner could not have been able to afford to buy the
property on his annual income of P168,648.00 in 1993 as appearing on his
Service Record. It likewise found petitioners explanation as unusual, largely
unsubstantiated, unbelievable and self-serving. The PCAGC noted that
instead of adducing evidence, petitioners counsel exerted more effort in
filing pleadings and motion to dismiss on the ground of forum shopping. It
also took against petitioner his refusal to submit his SALN and ITR despite
the undertaking made by his counsel which raised the presumption that
evidence willfully suppressed would be adverse if produced. The PCAGC
concluded that as petitioners acquisition of the subject property was
manifestly out of proportion to his salary, it has been unlawfully acquired.
Thus, it recommended petitioners dismissal from service pursuant to Section
8 of R.A. No. 3019.

On August 24, 1998, the Office of the President, concurring with the findings
and adopting the recommendation of the PCAGC, issued Administrative
Order No. 12,[4] ordering petitioners dismissal from service with forfeiture of
all government benefits.

Petitioners Motion for Reconsideration was denied. His appeal to the Court of
Appeals was likewise dismissed.[5]

Hence, this petition for review where petitioner raises the following issues for
resolution: first, whether he was denied due process in the investigation
before the PCAGC; second, whether his guilt was proved by substantial
evidence; and, third, whether the earlier dismissal of similar cases before
the Ombudsman rendered the administrative case before the PCAGC moot
and academic.
On the issue of due process, petitioner submits that the PCAGC committed
infractions of the cardinal rules of administrative due process when it relied
on Bundalians unverified letter-complaint. He gripes that his counter-affidavit
should have been given more weight as the unverified complaint constitutes
hearsay evidence. Moreover, petitioner insists that in ruling against him, the
PCAGC failed to respect his right to confront and cross-examine the
complainant as the latter never appeared in any of the hearings before the
PCAGC nor did he send a representative therein.

We find no merit in his contentions. The essence of due process in

administrative proceedings is the opportunity to explain ones side or seek a
reconsideration of the action or ruling complained of. As long as the parties
are given the opportunity to be heard before judgment is rendered, the
demands of due process are sufficiently met.[6] In the case at bar, the
PCAGC exerted efforts to notify the complainant of the proceedings but his
Philippine residence could not be located.[7] Be that as it may, petitioner
cannot argue that he was deprived of due process because he failed to
confront and cross-examine the complainant. Petitioner voluntarily submitted
to the jurisdiction of the PCAGC by participating in the proceedings before it.
He was duly represented by counsel. He filed his counter-affidavit, submitted
documentary evidence, attended the hearings, moved for a reconsideration
of Administrative Order No. 12 issued by the President and eventually filed
his appeal before the Court of Appeals. His active participation in every step
of the investigation effectively removed any badge of procedural deficiency,
if there was any, and satisfied the due process requirement. He cannot now
be allowed to challenge the procedure adopted by the PCAGC in the
investigation.[8]

Neither can we sustain petitioners contention that the charge against him
was unsupported by substantial evidence as it was contained in an unverified
complaint. The lack of verification of the administrative complaint and the
non-appearance of the complainant at the investigation did not divest the
PCAGC of its authority to investigate the charge of unexplained wealth.
Under Section 3 of Executive Order No. 151 creating the PCAGC, complaints
involving graft and corruption may be filed before it in any form or
manner against presidential appointees in the executive department.
Indeed, it is not totally uncommon that a government agency is given a wide
latitude in the scope and exercise of its investigative powers. The
Ombudsman, under the Constitution, is directed to act on any complaint
likewise filed in any form and manner concerning official acts or omissions.
The Court Administrator of this Court investigates and takes cognizance of,
not only unverified, but even anonymous complaints filed against court
employees or officials for violation of the Code of Ethical Conduct. This policy
has been adopted in line with the serious effort of the government to
minimize, if not eradicate, graft and corruption in the service.
It is well to remember that in administrative proceedings, technical rules of
procedure and evidence are not strictly applied. Administrative due process
cannot be fully equated with due process in its strict judicial sense for it is
enough that the party is given the chance to be heard before the case
against him is decided.[9] This was afforded to the petitioner in the case at
bar.

On the second issue, there is a need to lay down the basic principles in
administrative investigations. First, the burden is on the complainant to
prove by substantial evidence the allegations in his complaint.
[10]Substantial evidence is more than a mere scintilla of evidence. It means
such relevant evidence as a reasonable mind might accept as adequate to
support a conclusion, even if other minds equally reasonable might
conceivably opine otherwise.[11] Second, in reviewing administrative
decisions of the executive branch of the government, the findings of facts
made therein are to be respected so long as they are supported by
substantial evidence. Hence, it is not for the reviewing court to weigh the
conflicting evidence, determine the credibility of witnesses, or otherwise
substitute its judgment for that of the administrative agency with respect to
the sufficiency of evidence. Third, administrative decisions in matters within
the executive jurisdiction can only be set aside on proof of gross abuse of
discretion, fraud, or error of law. These principles negate the power of the
reviewing court to re-examine the sufficiency of the evidence in an
administrative case as if originally instituted therein, and do not authorize
the court to receive additional evidence that was not submitted to the
administrative agency concerned.[12]

In the case at bar, petitioner admitted that the subject property was in his
name. However, he insisted that it was his sister-in-law Estela Fajardo who
paid for the property in installments. He submitted as proof thereof the
checks issued by Fajardo as payment for the amortizations of the property.
His evidence, however, likewise fail to convince us. First, the record is bereft
of evidence to prove the alleged internal arrangement petitioner entered into
with Fajardo. He did not submit her affidavit to the investigating body nor did
she testify before it regarding her ownership of the Burbank property.
Second, the checks allegedly issued by Fajardo to pay for the monthly
amortizations on the property have no evidentiary weight as Fajardos mere
issuance thereof cannot prove petitioners non-ownership of the property.
Fajardo would naturally issue the checks as she was appointed by petitioner
as attorney-in-fact and the latter would naturally course through her the
payments for the Burbank property. Third, petitioners own evidence
contradict his position. We cannot reconcile petitioners denial of ownership
of the property with the loan statement[13] he adduced showing that he
obtained a loan from the World Savings and Loan Association for
$195,000.00 on June 23, 1993 to finance the acquisition of the property.
Then, three (3) years later, on May 30, 1996, petitioner and his wife
executed a Quitclaim Deed[14] donating the Burbank property to his sisters-
in-law Estela and Rose Fajardo allegedly to prove his non-ownership of the
property. It is obvious that the Quitclaim Deed is a mere afterthought, having
been executed only after a complaint for unexplained wealth was lodged
against petitioner. Why the Quitclaim Deed included Rose Fajardo when it
was only Estela Fajardo who allegedly owned the property was not explained
on the record. Petitioners evidence failed to clarify the issue as it produced,
rather than settled, more questions.

Petitioner admitted that the Grant Deed over the property was in his name.
He never denied the existence and due execution of the Grant Deed and the
Special Power of Attorney he conferred to Estela Fajardo with respect to the
acquisition of the Burbank property. With these admissions, the burden of
proof was shifted to petitioner to prove non-ownership of the property. He
cannot now ask this Court to remand the case to the PCAGC for reception of
additional evidence as, in the absence of any errors of law, it is not within
the Courts power to do so. He had every opportunity to adduce his evidence
before the PCAGC.

Lastly, we cannot sustain petitioners stance that the dismissal of similar

charges against him before the Ombudsman rendered the administrative
case against him before the PCAGC moot and academic. To be sure, the
decision of the Ombudsman does not operate as res judicata in the PCAGC
case subject of this review. The doctrine of res judicata applies only to
judicial or quasi-judicial proceedings, not to the exercise of administrative
powers.[15]Petitioner was investigated by the Ombudsman for his possible
criminal liability for the acquisition of the Burbank property in violation of the
Anti-Graft and Corrupt Practices Act and the Revised Penal Code. For the
same alleged misconduct, Petitioner, as a presidential appointee, was
investigated by the PCAGC by virtue of the administrative power and control
of the President over him. As the PCAGCs investigation of petitioner was
administrative in nature, the doctrine of res judicata finds no application in
the case at bar.

Thus, we find that the Court of Appeals correctly sustained petitioners

dismissal from service as the complaint and its supporting documents
established that he acquired a property whose value is disproportionate to
his income in the government service, unless he has other sources of income
which he failed to reveal. His liability was proved by substantial evidence.

IN VIEW WHEREOF, the petition is DISMISSED. No costs.

SO ORDERED.

Panganiban, Sandoval-Gutierrez, Corona, and Carpio Morales, JJ.,

concur.
28. G.R. Nos. 95122-23             May 31, 1991

BOARD OF COMMISSIONERS (COMMISSION ON IMMIGRATION AND

DEPORTATION), BOARD OF SPECIAL INQUIRY, COMMISSIONER
ANDREA D. DOMINGO, ASSOCIATE COMMISSIONER JORGE V.
SARMIENTO, ACTING ASSOCIATE COMMISSIONER REGINO R.
SANTIAGO, MEMBERS OF THE BOARD OF SPECIAL INQUIRY,
ESTANISLAO CANTA, LEO MAGAHOM and BENJAMIN
KALAW, petitioners,
vs.
HON. JOSELITO DELA ROSA, Presiding Judge, RTC Manila, Branch 29,
WILLIAM T. GATCHALIAN, respondents.

BOARD OF COMMISSIONERS (COMMISSION ON IMMIGRATION AND

DEPORTATION), BOARD OF SPECIAL INQUIRY, COMMISSIONER
ANDREA D. DOMINGO, ASSOCIATE COMMISSIONER JORGE V.
SARMIENTO, ACTING ASSOCIATE COMMISSIONER REGINO R.
SANTIAGO, MEMBERS OF THE BOARD OF SPECIAL INQUIRY,
ESTANISLAO CANTA, LEO MAGAHOM and BENJAMIN
KALAW, petitioners,
vs.
HON. TERESITA DIZON CAPULONG, Presiding Judge, RTC Branch 172,
Valenzuela, Metro Manila, DEE HUA T. GATCHALIAN, SHERWING T.
GATCHALIAN, KENNETH T. GATCHALIAN, REXLON T. GATCHALIAN,
and WESLIE T. GATCHALIAN, respondents.

G.R. Nos. 95612-13             May 31, 1991

WILLIAM T. GATCHALIAN, petitioner,
vs.
BOARD OF COMMISSIONERS (COMMISSION ON IMMIGRATION AND
DEPORTATION), et al., respondents.

The Solicitor General for petitioners.

edesma, Saludo & Associates for respondent William Gatchalian.
Cervo and Tanay Law Office for respondent T.D. Capulong, D.H.T.
Gatchalian, et al.

BIDIN, J.:
This is a petition for certiorari and prohibition filed by the Solicitor General
seeking 1) to set aside the Resolution/Temporary Restraining Order dated
September 7, 1990, issued by respondent Judge de la Rosa in Civil Case No.
90-54214 which denied petitioners' motion to dismiss and restrained
petitioners from commencing or continuing with any of the proceedings
which would lead to the deportation of respondent William Gatchalian,
docketed as D.C. No. 90-523, as well as the Order of respondent Judge
Capulong dated September 6, 1990 in Civil Case No. 3431-V-90 which
likewise enjoined petitioners from proceeding with the deportation charges
against respondent Gatchalian, and 2) to prohibit respondent judges from
further acting in the aforesaid civil cases.

On October 23, 1990, respondent Gatchalian filed his Comment with

Counter-Petition, docketed as G.R. Nos. 96512-13, alleging lack of jurisdiction
on the part of respondent Board of Commissioners, et al., over his person
with prayer that he be declared a Filipino citizen, or in the alternative, to
remand the case to the trial court for further proceedings.

On December 13, 1990, petitioners filed their comment to respondent

Gatchalian's counter-petition. The Court considers the comment filed by
respondent Gatchalian as answer to the petition and petitioners' comment as
answer to the counter-petition and gives due course to the petitions.

There is no dispute as to the following facts:

On July 12, 1960, Santiago Gatchalian, grandfather of William Gatchalian,

was recognized by the Bureau of Immigration as a native born Filipino citizen
following the citizenship of his natural mother, Marciana Gatchalian (Annex
"1", counter-petition). Before the Citizenship Evaluation Board, Santiago
Gatchalian testified that he has five (5) children with his wife Chu Gim Tee,
namely: Jose Gatchalian, Gloria Gatchalian, Francisco Gatchalian, Elena
Gatchalian and Benjamin Gatchalian (Annex "2", counter-petition).

On June 27, 1961, William Gatchalian, then a twelve-year old minor, arrived
in Manila from Hongkong together with Gloria, Francisco, and Johnson, all
surnamed Gatchalian. They had with them Certificates of Registration and
Identity issued by the Philippine Consulate in Hongkong based on a
cablegram bearing the signature of the then Secretary of Foreign Affairs,
Felixberto Serrano, and sought admission as Filipino citizens. Gloria and
Francisco are the daughter and son, respectively, of Santiago Gatchalian;
while William and Johnson are the sons of Francisco.

After investigation, the Board of Special Inquiry No. 1 rendered a decision

dated July 6, 1961, admitting William Gatchalian and his companions as
Filipino citizens (Annex "C", petition). As a consequence thereof, William
Gatchalian was issued Identification Certificate No. 16135 by the immigration
authorities on August 16, 1961 (Annex "D", petition).

On January 24, 1962, the then Secretary of Justice issued Memorandum No. 9
setting aside all decisions purporting to have been rendered by the Board of
Commissioners on appeal or on review motu proprio of decisions of the
Board of Special Inquiry. The same memorandum directed the Board of
Commissioners to review all cases where entry was allowed on the ground
that the entrant was a Philippine citizen. Among those cases was that of
William and others.

On July 6, 1962, the new Board of Commissioners, after a review motu

proprio of the proceedings had in the Board of Special Inquiry, reversed the
decision of the latter and ordered the exclusion of, among others,
respondent Gatchalian (Annex "E", petition). A warrant of exclusion also
dated July 6, 1962 was issued alleging that "the decision of the Board of
Commissioners dated July 6, 1962 . . . has now become final and executory
(Annex "F", petition).

The actual date of rendition of said decision by the Board of Commissioners

(whether on July 6, 1962 or July 20, 1962) became the subject of controversy
in the 1967 case of Arocha vs. Vivo (21 SCRA 532) wherein this Court
sustained the validity of the decision of the new Board of Commissioners
having been promulgated on July 6, 1962, or within the reglementary period
for review.

Sometime in 1973, respondent Gatchalian, as well as the others covered by

the July 6, 1962 warrant of exclusion, filed a motion for re-hearing with the
Board of Special Inquiry where the deportion case against them was
assigned.

On March 14, 1973, the Board of Special Inquiry recommended to the then
Acting Commissioner Victor Nituda the reversal of the July 6, 1962 decision
of the then Board of Commissioners and the recall of the warrants of arrest
issued therein (Annex "5", counter-petition).

On March 15, 1973, Acting Commissioner Nituda issued an order reaffirming

the July 6, 1961 decision of the Board of Special Inquiry thereby admitting
respondent Gatchalian as a Filipino citizen and recalled the warrant of arrest
issued against him (Annex "6", counter-petition).

On June 7, 1990, the acting director of the National Bureau of Investigation

wrote the Secretary of Justice recommending that respondent Gatchalian
along with the other applicants covered by the warrant of exclusion dated
July 6, 1962 be charged with violation of Sec. 37 (a), pars. 1 and 2, in relation
to Secs. 45 (c), and (d) and (e) of Commonwealth Act No. 613, as amended,
also known as the Immigration Act of 1940 (Annex "G", petition).

On August 1, 1990, the Secretary of Justice indorsed the recommendation of

the NBI to the Commissioner of Immigration for investigation and immediate
action (Annex "20", counter-petition).

On August 15, 1990, petitioner Commissioner Domingo of the Commission of

Immigration and Deportation * issued a mission order commanding the
arrest of respondent William Gatchalian (Annex "18", counter-petition). The
latter appeared before Commissioner Domingo on August 20, 1990 and was
released on the same day upon posting P200,000.00 cash bond.

On August 29, 1990, William Gatchalian filed a petition for certiorari and

prohibition with injunction before the Regional Trial Court of Manila, Br. 29,
presided by respondent Judge dela Rosa, docketed as Civil Case No. 90-
54214.

On September 4, 1990, petitioners filed a motion to dismiss Civil Case No.

90-54214 alleging that respondent judge has no jurisdiction over the Board
of Commissioners and/or the Board of Special Inquiry. Nonetheless,
respondent judge dela Rosa issued the assailed order dated September 7,
1990, denying the motion to dismiss.

Meanwhile, on September 6, 1990, respondent Gatchalian's wife and minor

children filed before the Regional Trial Court of Valenzuela, Metro Manila, Br.
172, presided by respondent judge Capulong Civil Case No. 3431-V-90 for
injunction with writ of preliminary injunction. The complaint alleged, among
others, that petitioners acted without or in excess of jurisdiction in the
institution of deportation proceedings against William. On the same day,
respondent Capulong issued the questioned temporary restraining order
restraining petitioners from continuing with the deportation proceedings
against William Gatchalian.

The petition is anchored on the following propositions: 1) respondent judges

have no jurisdiction over petitioners (Board of Commissioners, et al.,) and
the subject matter of the case, appellate jurisdiction being vested by BP 129
with the Court of Appeals; 2) assuming respondent judges have jurisdiction,
they acted with grave abuse of discretion in preempting petitioners in the
exercise of the authority and jurisdiction to hear and determine the
deportation case against respondent Gatchalian, and in the process
determine also his citizenship; 3) respondent judge dela Rosa gravely abused
his discretion in ruling that the issues raised in the deportation proceedings
are beyond the competence and jurisdiction of petitioners, thereby
disregarding the cases of Arocha vs. Vivo and Vivo vs. Arca (supra), which
put finality to the July 6, 1962 decision of the Board of Commissioners that
respondent Gatchalian is a Chinese citizen; and 4) respondent judge
Capulong should have dismissed Civil Case No. 3431-V-90 for forum-
shopping.

In his counter-petition, William Gatchalian alleges among others that: 1)

assuming that the evidence on record is not sufficient to declare him a
Filipino citizen, petitioners have no jurisdiction to proceed with the
deportation case until the courts shall have finally resolved the question of
his citizenship; 2) petitioners can no longer judiciously and fairly resolve the
question of respondent's citizenship in the deportation case because of their
bias, pre-judgment and prejudice against him; and 3) the ground for which
he is sought to be deported has already prescribed.

For purposes of uniformity, the parties herein will be referred to in the order
the petitions were filed.

Petitioners argue that under Sec. 9 (3) of BP 129, it is the Court of Appeals
which has exclusive appellate jurisdiction over all final judgments or orders
of quasi-judicial agencies, boards or commissions, such as the Board of
Commissioners and the Board of Special Inquiry.

Respondent, on the other hand, contends that petitioners are not quasi-
judicial agencies and are not in equal rank with Regional Trial Courts.

Under Sec. 21 (1) of Batas Pambansa Blg. 129, the Regional Trial Courts
have concurrent jurisdiction with this Court and the Court of Appeals to issue
"writs of certiorari, prohibition, mandamus, quo warranto, habeas corpus and
injunction which may be enforced in any part of their respective regions, . . ."
Thus, the RTCs are vested with the power to determine whether or not there
has been a grave abuse of discretion on the part of any branch or
instrumentality of the government.

It is true that under Sec. 9 (3) of Batas Pambansa Blg. 129, the Court of
Appeals is vested with —

(3) Exclusive appellate jurisdiction over all final judgments, decisions,

resolutions, order, or awards of Regional Trial Courts and quasi-judicial
agencies, instrumentalities, board or commission, except those falling
within the appellate jurisdiction of the Supreme Court in accordance
with the Constitution, the provisions of this Act, and of sub-paragraph
(1) of the third paragraph of and sub-paragraph (4) of the fourth
paragraph of Section 17 of the Judiciary Act of 1948.

It does not provide, however, that said exclusive appellate jurisdiction of the
Court of Appeals extends to all quasi-judicial agencies. The quasi-judicial
bodies whose decisions are exclusively appealable to the Court of Appeals
are those which under the law, Republic Act No. 5434, or their enabling acts,
are specifically appealable to the Court of Appeals (Presidential Anti-Dollar
Salting Task Force vs. Court of Appeals, 171 SCRA 348 [1989]; Lupangco vs.
Court of Appeals, 160 SCRA 848 [1988]). Thus, under Republic Act No. 5434,
it is specifically provided that the decisions of the Land Registration
Commission (LRC), the Social Security Commission (SSC), Civil Aeronautics
Board (CAB), the Patent Office and the Agricultural Invention Board are
appealable to the Court of Appeals.

In the Presidential Anti-Dollar Salting Task Force (supra), this Court clarified
the matter when We ruled:

Under our Resolution dated January 11, 1983:

. . . The appeals to the Intermediate Appellate Court (now Court

of Appeals) from quasi-judicial bodies shall continue to be
governed by the provisions of Republic Act No. 5434 insofar as
the same is not inconsistent with the provisions of B.P. Blg. 129.

The pertinent provisions of Republic Act No. 5434 are as follows:

Sec. 1. Appeals from specified agencies.— Any provision of

existing law or Rules of Court to the contrary notwithstanding,
parties aggrieved by a final ruling, award, order, or decision, or
judgment of the Court of Agrarian Relations; the Secretary of
Labor under Section 7 of Republic Act Numbered Six hundred
and two, also known as the "Minimum Wage Law"; the
Department of Labor under Section 23 of Republic Act Numbered
Eight hundred seventy-five, also known as the "Industrial Peace
Act"; the Land Registration Commission; the Social Security
Commission; the Civil Aeronautics Board; the Patent Office and
the Agricultural Inventions Board, may appeal therefrom to the
Court of Appeals, within the period and in the manner herein
provided, whether the appeal involves questions of fact, mixed
questions of fact and law, or questions of law, or all three kinds
of questions. From final judgments or decisions of the Court of
Appeals, the aggrieved party may appeal by certiorari to the
Supreme Court as provided under Rule 45 of the Rules of Court.

Because of subsequent amendments, including the abolition of various

special courts, jurisdiction over quasi-judicial bodies has to be,
consequently, determined by the corresponding amendatory statutes.
Under the Labor Code, decisions and awards of the National Labor
Relations Commission are final and executory, but, nevertheless,
reviewable by this Court through a petition for certiorari and not by
way of appeal.
 Under the Property Registration Decree, decision of the Commission of
Land Registration, en consulta, are appealable to the Court of Appeals.

The decisions of the Securities and Exchange Commission are likewise

appealable to the Appellate Court, and so are decisions of the Social
Security Commission.

As a rule, where legislation provides for an appeal from decisions of

certain administrative bodies to the Court of Appeals, it means that
such bodies are co-equal with the Regional Trial Courts, in terms of
rank and stature, and logically, beyond the control of the latter.
(Emphasis supplied)

There are quasi-judicial agencies, as the National Labor Relations

Commissions, whose decisions are directly appealable to this Court. It is only
when a specific law, as Republic Act No. 5434, provides appeal from certain
bodies or commissions to the Court of Appeals as the Land Registration
Commission (LRC), Securities and Exchange Commission (SEC) and others,
that the said commissions or boards may be considered co-equal with the
RTCs in terms of rank, stature and are logically beyond the control of the
latter.

However, the Bureau of Immigration (or CID) is not among those quasi-
judicial agencies specified by law whose decisions, orders, and resolutions
are directly appealable to the Court of Appeals. In fact, its decisions are
subject to judicial review in accordance with Sec. 25, Chapter 4, Book VII of
the 1987 Administrative Code, which provides as follows:

Sec. 25. Judicial Review.—(1) Agency decisions shall be subject to

judicial review in accordance with this chapter and applicable laws.

x x x           x x x          x x x

(6) The review proceeding shall be filed in the court specified in the
statute or, in the absence thereof, in any court of competent
jurisdiction in accordance with the provisions on venue of the Rules of
Court.

Said provision of the Administrative Code, which is subsequent to B.P. Blg.

129 and which thus modifies the latter, provides that the decision of an
agency like the Bureau of Immigration should be subject to review by the
court specified by the statute or in the absence thereof, it is subject to
review by any court of competent jurisdiction in accordance with the
provisions on venue of the Rules of Court.
B.P. Blg. 129 did not intend to raise all quasi-judicial bodies to the same level
or rank of the RTC except those specifically provided for under the law as
aforestated. As the Bureau of Immigration is not of equal rank as the RTC, its
decisions may be appealable to, and may be reviewed through a special civil
action for certiorari by, the RTC (Sec. 21, (1) BP 129).

True, it is beyond cavil that the Bureau of Immigration has the exclusive
authority and jurisdiction to try and hear cases against an alleged alien, and
in the process, determine also their citizenship (Lao Gi vs. Court of Appeals,
180 SCRA 756 [1989]). And a mere claim of citizenship cannot operate to
divest the Board of Commissioners of its jurisdiction in deportation
proceedings (Miranda vs. Deportation Board, 94 Phil. 531 [1954]).

However, the rule enunciated in the above-cases admits of an exception, at

least insofar as deportation proceedings are concerned. Thus, what if the
claim to citizenship of the alleged deportee is satisfactory? Should the
deportation proceedings be allowed to continue or should the question of
citizenship be ventilated in a judicial proceeding? In Chua Hiong vs.
Deportation Board (96 Phil. 665 [1955]), this Court answered the question in
the affirmative, and We quote:

When the evidence submitted by a respondent is conclusive of his

citizenship, the right to immediate review should also be recognized
and the courts should promptly enjoin the deportation proceedings. A
citizen is entitled to live in peace, without molestation from any official
or authority, and if he is disturbed by a deportation proceeding, he has
the unquestionable right to resort to the courts for his protection,
either by a writ of habeas corpus or of prohibition, on the legal ground
that the Board lacks jurisdiction. If he is a citizen and evidence thereof
is satisfactory, there is no sense nor justice in allowing the deportation
proceedings to continue, granting him the remedy only after the Board
has finished its investigation of his undesirability.

. . . And if the right (to peace) is precious and valuable at all, it must
also be protected on time, to prevent undue harassment at the hands
of ill-meaning or misinformed administrative officials. Of what use is
this much boasted right to peace and liberty if it can be availed of only
after the Deportation Board has unjustly trampled upon it, besmirching
the citizen's name before the bar of public opinion? (Emphasis
supplied)

The doctrine of primary jurisdiction of petitioners Board of Commissioners

over deportation proceedings is, therefore, not without exception (Calacday
vs. Vivo, 33 SCRA 413 [1970]; Vivo vs. Montesa, 24 SCRA 155 [1967]).
Judicial intervention, however, should be granted only in cases where the
"claim of citizenship is so substantial that there are reasonable grounds to
believe that the claim is correct. In other words, the remedy should be
allowed only on sound discretion of a competent court in a proper
proceeding (Chua Hiong vs. Deportation Board, supra; Co. vs. Deportation
Board, 78 SCRA 107 [1977]). It appearing from the records that respondent's
claim of citizenship is substantial, as We shall show later, judicial
intervention should be allowed.

In the case at bar, the competent court which could properly take cognizance
of the proceedings instituted by respondent Gatchalian would nonetheless be
the Regional Trial Court and not the Court of Appeals in view of Sec. 21 (1),
BP 129, which confers upon the former jurisdiction over actions for
prohibition concurrently with the Court of Appeals and the Supreme Court
and in line with the pronouncements of this Court in Chua
Hiong and Co cases.

Ordinarily, the case would then be remanded to the Regional Trial Court. But
not in the case at bar.1âwphi1 Considering the voluminous pleadings
submitted by the parties and the evidence presented, We deem it proper to
decide the controversy right at this instance. And this course of action is not
without precedent for "it is a cherished rule of procedure for this Court to
always strive to settle the entire controversy in a single proceeding leaving
no root or branch to bear the seeds of future litigation. No useful purpose will
be served if this case is remanded to the trial court only to have its decision
raised again to the Court of Appeals and from there to this Court" (Marquez
vs. Marquez, 73 Phil. 74; Keramic Industries, Inc. vs. Guerrero, 61 SCRA 265
[1974]) Alger Electric, Inc. vs. Court of Appeals (135 SCRA 37
[1985]), citing Gayos vs. Gayos (67 SCRA 146 [1975]).

In Lianga Bay Logging Co., Inc. vs. Court of Appeals (157 SCRA 357 [1988]),
We also stated:

Remand of the case to the lower court for further reception of evidence
is not necessary where the court is in a position to resolve the dispute
based on the records before it. On many occasions, the Court, in the
public interest and the expeditious administration of justice, has
resolved actions on the merits instead of remanding them to the trial
court for further proceedings, such as where the ends of justice would
not be subserved by the remand of the case or when public interest
demands an early disposition of the case or where the trial court had
already received all the evidence of the parties (Quisumbing vs. CA,
112 SCRA 703; Francisco, et al., vs. The City of Davao, et al., supra;
Republic vs. Security Credit & Acceptance Corp., et al., 19 SCRA 58;
Samal vs. CA, supra; Republic vs. Central Surety & Insurance Co., 25
SCRA 641).

Likewise in Tejones vs. Gironella (159 SCRA 100 [1988]), We said:

 Sound practice seeks to accommodate the theory which avoids waste
of time, effort and expense, both to the parties and the government,
not to speak of delay in the disposal of the case (cf. Fernandez vs.
Garcia, 92 Phil. 592, 297). A marked characterstic of our judicial set-up
is that where the dictates of justice so demand . . . the Supreme Court
should act, and act with finality (Li Siu Liat vs. Republic, 21 SCRA 1039,
1046, citing Samal vs. CA, 99 Phil. 230 and US vs. Gimenez, 34 Phil.
74.) (Beautifont, Inc. vs. Court of appeals, et al., Jan. 29, 1988; See
also Labo vs. Commission on Elections, 176 SCRA 1 [1989]).

Respondent Gatchalian has adduced evidence not only before the Regional
Trial Court but also before Us in the form of public documents attached to his
pleadings. On the other hand, Special Prosecutor Renato Mabolo in his
Manifestation (dated September 6, 1990; Rollo, p. 298, counter-petition)
before the Bureau of Immigration already stated that there is no longer a
need to adduce evidence in support of the deportation charges against
respondent. In addition, petitioners invoke that this Court's decision
in Arocha vs. Vivo and Vivo vs. Arca (supra), has already settled respondent's
alienage. Hence, the need for a judicial determination of respondent's
citizenship specially so where the latter is not seeking admission, but is
already in the Philippines (for the past thirty [30] years) and is being
expelled (Chua Hiong vs. Deportation Board, supra).

According to petitioners, respondent's alienage has been conclusively settled

by this Court in the Arocha and Vivo cases, We disagree. It must be noted
that in said cases, the sole issue resolved therein was the actual date of
rendition of the July 6, 1962 decision of the then board of
Commissioners, i.e., whether the decision was rendered on July 6, 1962 or on
July 20, 1962 it appearing that the figure (date) "20" was erased and over it
was superimposed the figure "6" thereby making the decision fall within the
one-year reglementary period from July 6, 1961 within which the decision
may be reviewed. This Court did not squarely pass upon any question of
citizenship, much less that of respondent's who was not a party in the
aforesaid cases. The said cases originated from a petition for a writ
of habeas corpus filed on July 21, 1965 by Macario Arocha in behalf of Pedro
Gatchalian. Well settled is the rule that a person not party to a case cannot
be bound by a decision rendered therein.

Neither can it be argued that the Board of Commissioners' decision (dated

July 6, 1962) finding respondent's claim to Philippine citizenship not
satisfactorily proved, constitute res judicata. For one thing, said decision did
not make any categorical statement that respondent Gatchalian is a Chinese.
Secondly, the doctrine of res judicata does not apply to questions of
citizenship (Labo vs. Commission on Elections (supra); citing Soria vs.
Commissioner of Immigration, 37 SCRA 213; Lee vs. Commissioner of
Immigration, 42 SCRA 561 [1971]; Sia Reyes vs. Deportation Board, 122
SCRA 478 [1983]).

In Moy Ya Lim vs. Commissioner of Immigration (41 SCRA 292 [1971]) and

in Lee vs. Commissioner of Immigration (supra), this Court declared that:

(e)verytime the citizenship of a person is material or indispensable in a

judicial or administrative case, whatever the corresponding court or
administrative authority decides therein as to such citizenship is
generally not considered as res adjudicata, hence it has to be threshed
out again and again as the occasion may demand.

An exception to the above rule was laid by this Court in Burca vs.
Republic (51 SCRA 248 [1973]), viz:

We declare it to be a sound rule that where the citizenship of a party in

a case is definitely resolved by a court or by an administrative agency,
as a material issue in the controversy, after a full-blown hearing with
the active participation of the Solicitor General or his authorized
representative, and this finding or the citizenship of the party is
affirmed by this Court, the decision on the matter shall constitute
conclusive proof of such party's citizenship in any other case or
proceeding. But it is made clear that in no instance will a decision on
the question of citizenship in such cases be considered conclusive or
binding in any other case or proceeding, unless obtained in accordance
with the procedure herein stated.

Thus, in order that the doctrine of res judicata may be applied in cases of

citizenship, the following must be present: 1) a person's citizenship must be
raised as a material issue in a controversy where said person is a party; 2)
the Solicitor General or his authorized representative took active part in the
resolution thereof, and 3) the finding or citizenship is affirmed by this Court.

Gauged by the foregoing, We find the pre-conditions set forth

in Burca inexistent in the Arocha and Vivo cases relied upon by petitioners.
Indeed, respondent William Gatchalian was not even a party in said cases.

Coming now to the contention of petitioners that the arrest of respondent

follows as a matter of consequence based on the warrant of exclusion issued
on July 6, 1962, coupled with the Arocha and Vivo cases (Rollo, pp. 33), the
Court finds the same devoid of merit.

Sec. 37 (a) of Commonwealth Act No. 613, as amended, otherwise known as

the Immigration Act of 1940, reads:
 Sec. 37. (a) The following aliens shall be arrested upon the warrant of
the Commissioner of Immigration or of any other officer designated by
him for the purpose and deported upon the warrant of the
Commissioner of Immigration after a determination by the Board of
Commissioner of the existence of the ground for deportation as
charged against the alien. (Emphasis supplied)

From a perusal of the above provision, it is clear that in matters of

implementing the Immigration Act insofar as deportation of aliens are
concerned, the Commissioner of Immigration may issue warrants of arrest
only after a determination by the Board of Commissioners of the existence of
the ground for deportation as charged against the alien. In other words, a
warrant of arrest issued by the Commissioner of Immigration, to be valid,
must be for the sole purpose of executing a final order of deportation. A
warrant of arrest issued by the Commissioner of Immigration for purposes of
investigation only, as in the case at bar, is null and void for being
unconstitutional (Ang Ngo Chiong vs. Galang, 67 SCRA 338 [1975] citing Po
Siok Pin vs. Vivo, 62 SCRA 363 [1975]; Vivo vs. Montesa, 24 SCRA 155;
Morano vs. Vivo, 20 SCRA 562; Qua Chee Gan vs. Deportation Board, 9 SCRA
27 [1963]; Ng Hua To vs. Galang, 10 SCRA 411; see also Santos vs.
Commissioner of Immigration, 74 SCRA 96 [1976]).

As We held in Qua Chee Gan vs. Deportation Board (supra), "(t)he

constitution does not distinguish warrants between a criminal case and
administrative proceedings. And if one suspected of having committed a
crime is entitled to a determination of the probable cause against him, by a
judge, why should one suspected of a violation of an administrative nature
deserve less guarantee?" It is not indispensable that the alleged alien be
arrested for purposes of investigation. If the purpose of the issuance of the
warrant of arrest is to determine the existence of probable cause, surely, it
cannot pass the test of constitutionality for only judges can issue the same
(Sec. 2, Art. III, Constitution).

A reading of the mission order/warrant of arrest (dated August 15,

1990; Rollo, p. 183, counter-petition) issued by the Commissioner of
Immigration, clearly indicates that the same was issued only for purposes of
investigation of the suspects, William Gatchalian included. Paragraphs 1 and
3 of the mission order directs the Intelligence Agents/Officers to:

x x x           x x x          x x x

1. Make a warrantless arrest under the Rules of Criminal Procedure,

Rule 113, Sec. 5, for violation of the Immigration Act, Sec. 37, para. a;
Secs. 45 and 46 Administrative Code;

x x x           x x x          x x x
 3. Deliver the suspect to the Intelligence Division and immediately
conduct custodial interrogation, after warning the suspect that he has
a right to remain silent and a right to counsel; . . .

Hence, petitioners' argument that the arrest of respondent was based,

ostensibly, on the July 6, 1962 warrant of exclusion has obviously no leg to
stand on. The mission order/warrant of arrest made no mention that the
same was issued pursuant to a final order of deportation or warrant of
exclusion.

But there is one more thing that militates against petitioners' cause. As
records indicate, which petitioners conveniently omitted to state either in
their petition or comment to the counter-petition of respondent, respondent
Gatchalian, along with others previously covered by the 1962 warrant of
exclusion, filed a motion for re-hearing before the Board of Special Inquiry
(BSI) sometime in 1973.

On March 14, 1973, the Board of Special Inquiry, after giving due course to
the motion for re-hearing, submitted a memorandum to the then Acting
Commissioner Victor Nituda (Annex "5", counter-petition) recommending 1
the reconsideration of the July 6, 1962 decision of the then Board of
Commissioners which reversed the July 6, 1961 decision of the then Board of
Special Inquiry No. 1 and 2 the lifting of the warrants of arrest issued against
applicants. The memorandum inferred that the "very basis of the Board of
Commissioners in reversing the decision of the Board of Special Inquiry was
due to a forged cablegram by the then Secretary of Foreign Affairs, . . .,
which was dispatched to the Philippine Consulate in Hong Kong authorizing
the registration of applicants as P.I. citizens." The Board of Special Inquiry
concluded that "(i)f at all, the cablegram only led to the issuance of their
Certificate(s) of Identity which took the place of a passport for their
authorized travel to the Philippines. It being so, even if the applicants could
have entered illegally, the mere fact that they are citizens of the Philippines
entitles them to remain in the country."

On March 15, 1973, then Acting Commissioner Nituda issued an Order

(Annex "6", counter-petition) which affirmed the Board of Special Inquiry No.
1 decision dated July 6, 1961 admitting respondent Gatchalian and others as
Filipino citizens; recalled the July 6, 1962 warrant of arrest and revalidated
their Identification Certificates.

The above order admitting respondent as a Filipino citizen is the last official
act of the government on the basis of which respondent William Gatchalian
continually exercised the rights of a Filipino citizen to the present.
Consequently, the presumption of citizenship lies in favor of respondent
William Gatchalian.
There should be no question that Santiago Gatchalian, grandfather of William
Gatchalian, is a Filipino citizen. As a matter of fact, in the very order of the
BOC of July 6, 1962, which reversed the July 6, 1961 BSI order, it is an
accepted fact that Santiago Gatchalian is a Filipino. The opening paragraph
of said order states:

The claim to Filipino citizenship of abovenamed applicants is based on

the citizenship of one Santiago Gatchalian whose Philippine citizenship
was recognized by the Bureau of Immigration in an Order dated July
12, 1960. (Annex "37", Comment with Counter-Petition).

Nonetheless, in said order it was found that the applicants therein have not
satisfactorily proven that they are the children and/or grandchildren of
Santiago Gatchalian. The status of Santiago Gatchalian as a Filipino was
reiterated in Arocha and Arca (supra) where advertence is made to the
"applicants being the descendants of one Santiago Gatchalian, a Filipino." (at
p. 539).

In the sworn statement of Santiago Gatchalian before the Philippine Consul

in Hongkong in 1961 (Annex "1" to the Comment of petitioners to Counter-
Petition), he reiterated his status as a Philippine citizen being the illegitimate
child of Pablo Pacheco and Marciana Gatchalian, the latter being a Filipino;
that he was born in Manila on July 25, 1905; and that he was issued
Philippine Passport No. 28160 (PA-No. A91196) on November 18, 1960 by the
Department of Foreign Affairs in Manila. In his affidavit of January 23, 1961
(Annex "5", counter-petition), Santiago reiterated his claim of Philippine
citizenship as a consequence of his petition for cancellation of his alien
registry which was granted on February 18, 1960 in C.E.B. No. 3660-L; and
that on July 20, 1960, he was recognized by the Bureau of Immigration as a
Filipino and was issued Certificate No. 1-2123.

The dissenting opinions of my esteemed brethrens, Messrs. Justices F.P.

Feliciano and H.G. Davide, Jr., proposing to re-open the question of
citizenship of Santiago Gatchalian at this stage of the case, where it is not
even put in issue, is quite much to late. As stated above, the records of the
Bureau of Immigration show that as of July 20, 1960, Santiago Gatchalian
had been declared to be a Filipino citizen. It is a final decision that forecloses
a re-opening of the same 30 years later. Petitioners do not even question
Santiago Gatchalian's Philippine citizenship. It is the citizenship of
respondent William Gatchalian that is in issue and addressed for
determination of the Court in this case.

Furthermore, petitioners' position is not enhanced by the fact that

respondent's arrest came twenty-eight (28) years after the alleged cause of
deportation arose. Section 37 (b) of the Immigration Act states that
deportation "shall not be effected . . . unless the arrest in the deportation
proceedings is made within five (5) years after the cause of deportation
arises." In Lam Shee vs. Bengzon (93 Phil. 1065 [1953]), We laid down the
consequences of such inaction, thus:

There is however an important circumstance which places this case

beyond the reach of the resultant consequence of the fraudulent act
committed by the mother of the minor when she admitted that she
gained entrance into the Philippines by making use of the name of a
Chinese resident merchant other than that of her lawful husband, and
that is, that the mother can no longer be the subject of deportation
proceedings for the simple reason that more than 5 years had elapsed
from the date of her admission. Note that the above irregularity was
divulged by the mother herself, who in a gesture of sincerity, made an
spontaneous admission before the immigration officials in the
investigation conducted in connection with the landing of the minor on
September 24, 1947, and not through any effort on the part of the
immigration authorities. And considering this frank admission, plus the
fact that the mother was found to be married to another Chinese
resident merchant, now deceased, who owned a restaurant in the
Philippines valued at P15,000 and which gives a net profit of P500 a
month, the immigration officials then must have considered the
irregularity not serious enough when, inspire of that finding, they
decided to land said minor "as a properly documented preference
quota immigrant" (Exhibit D). We cannot therefore but wonder why two
years later the immigration officials would reverse their attitude and
would take steps to institute deportation proceedings against the
minor.

Under the circumstances obtaining in this case, we believe that much

as the attitude of the mother would be condemned for having made
use of an improper means to gain entrance into the Philippines and
acquire permanent residence there, it is now too late, not to say
unchristian, to deport the minor after having allowed the mother to
remain even illegally to the extent of validating her residence by
inaction, thus allowing the period of prescription to set in and to elapse
in her favor. To permit his deportation at this late hour would be to
condemn him to live separately from his mother through no fault of his
thereby leaving him to a life of insecurity resulting from lack of support
and protection of his family. This inaction or oversight on the part of
immigration officials has created an anomalous situation which, for
reasons of equity, should be resolved in favor of the minor herein
involved. (Emphasis supplied)

In the case at bar, petitioners' alleged cause of action and deportation

against herein respondent arose in 1962. However, the warrant of arrest of
respondent was issued by Commissioner Domingo only on August 15, 1990
— 28 long years after. It is clear that petitioners' cause of action has already
prescribed and by their inaction could not now be validly enforced by
petitioners against respondent William Gatchalian. Furthermore, the warrant
of exclusion dated July 6, 1962 was already recalled and the Identification
certificate of respondent, among others, was revalidated on March 15, 1973
by the then Acting Commissioner Nituda.

It is also proposed in the dissenting opinions of Messrs. Justices Feliciano and

Davide, Jr., that the BOC decision dated July 6, 1962 and the warrant of
exclusion which was found to be valid in Arocha should be applicable to
respondent William Gatchalian even if the latter was not a party to said case.
They also opined that under Sec. 37 (b) of the Immigration Act, the five (5)
years limitation is applicable only where the deportation is sought to be
effected under clauses of Sec. 37 (b) other than clauses 2, 7, 8, 11 and 12
and that no period of limitation is applicable in deportations under clauses 2,
7, 8, 11 and 12.

The Court disagrees. Under Sec. 39 of the Immigration Act, it is reiterated

that such deportation proceedings should be instituted within five (5) years.
Section 45 of the same Act provides penal sanctions for violations of the
offenses therein enumerated with a fine of "not more than P1,000.00 and
imprisonment for not more than two (2) years and deportation if he is an
alien." Thus:

Penal Provisions

Sec. 45. Any individual who—

(a) When applying for an immigration document personates another

individual, or falsely appears in the name of deceased individual, or
evades the immigration laws by appearing under an assumed name;
fictitious name; or

(b) Issues or otherwise disposes of an immigration document, to any

person not authorized by law to receive such document; or

(c) Obtains, accepts or uses any immigration document, knowing it to

be false; or

(d) Being an alien, enters the Philippines without inspection and

admission by the immigration officials, or obtains entry into the
Philippines by wilful, false, or misleading representation or wilful
concealment of a material fact; or
 (e) Being an alien shall for any fraudulent purpose represent himself to
be a Philippine citizen in order to evade any requirement of the
immigration laws; or

(f) In any immigration matter shall knowingly make under oath any
false statement or representations; or

(g) Being an alien, shall depart from the Philippines without first
securing an immigration clearance certificates required by section
twenty-two of this Act; or

(h) Attempts or conspires with another to commit any of the foregoing

acts, shall be guilty of an offense, and upon conviction thereof, shall be
fined not more than one thousand pesos, and imprisoned for not more
than two years, and deported if he is an alien. (Emphasis supplied)

Such offenses punishable by correctional penalty prescribe in 10 years (Art.

90, Revised Penal Code); correctional penalties also prescribe in 10 years
(Art. 92, Revised Penal Code).

It must be noted, however, that under Sec. 1, Act No. 3326 [1926], as
amended, (Prescription for Violations Penalized by Special Acts and Municipal
Ordinances) "violations penalized by special acts shall, unless otherwise
provided in such acts, prescribe in accordance with the following rules: . . .c)
after eight years for those punished by imprisonment for two years or more,
but less than six years; . . ."

Consequently, no prosecution and consequent deportation for violation of the

offenses enumerated in the Immigration Act can be initiated beyond the
eight-year prescriptive period, the Immigration Act being a special
legislation.

The Court, therefore, holds that the period of effecting deportation of an

alien after entry or a warrant of exclusion based on a final order of the BSI or
BOC are not imprescriptible. The law itself provides for a period of
prescription. Prescription of the crime is forfeiture or loss of the rights of the
State to prosecute the offender after the lapse of a certain time, while
prescription of the penalty is the loss or forfeiture by the government of the
right to execute the final sentence after the lapse of a certain time (Padilla,
Criminal Law, Vol. 1, 1974, at p. 855).

"Although a deportation proceeding does not partake of the nature of a

criminal action, however, considering that it is a harsh and extraordinary
administrative proceeding affecting the freedom and liberty of a person, the
constitutional right of such person to due process should not be denied.
Thus, the provisions of the Rules of Court of the Philippines particularly on
criminal procedure are applicable to deportation proceedings." (Lao Gi vs.
Court of Appeals, supra). Under Sec. 6, Rule 39 of the Rules of Court, a final
judgment may not be executed after the lapse of five (5) years from the date
of its entry or from the date it becomes final and executory. Thereafter, it
may be enforced only by a separate action subject to the statute of
limitations. Under Art. 1144 (3) of the Civil Code, an action based on
judgment must be brought within 10 years from the time the right of action
accrues.

In relation to Sec. 37 (b) of the Immigration Act, the rule, therefore, is:

1. Deportation or exclusion proceedings should be initiated within five (5)

years after the cause of deportation or exclusion arises when effected under
any other clauses other than clauses 2, 7, 8, 11 and 12 and of paragraph (a)
of Sec. 37 of the Immigration Act; and

2. When deportation or exclusion is effected under clauses 2, 7, 8, 11 and 12

of paragraph (a) of Sec. 37, the prescriptive period of the deportation or
exclusion proceedings is eight (8) years.

In the case at bar, it took petitioners 28 years since the BOC decision was
rendered on July 6, 1962 before they commenced deportation or exclusion
proceedings against respondent William Gatchalian in 1990. Undoubtedly,
petitioners' cause of action has already prescribed. Neither may an action to
revive and/or enforce the decision dated July 6, 1962 be instituted after ten
(10) years (Art. 1144 [3], Civil Code).

Since his admission as a Filipino citizen in 1961, respondent William

Gatchalian has continuously resided in the Philippines. He married Ting Dee
Hua on July 1, 1973 (Annex "8", counter-petition) with whom he has four (4)
minor children. The marriage contract shows that said respondent is a
Filipino (Annex "8"). He holds passports and earlier passports as a Filipino
(Annexes "9", "10" & "11", counter-petition). He is a registered voter of
Valenzuela, Metro Manila where he has long resided and exercised his right
of suffrage (Annex 12, counter-petition). He engaged in business in the
Philippines since 1973 and is the director/officer of the International Polymer
Corp. and Ropeman International Corp. as a Filipino (Annexes, "13" & "14",
counter-petition). He is a taxpayer. Respondent claims that the companies
he runs and in which he has a controlling investment provides livelihood to
4,000 employees and approximately 25,000 dependents. He continuously
enjoyed the status of Filipino citizenship and discharged his responsibility as
such until petitioners initiated the deportation proceedings against him.

"The power to deport an alien is an act of the State. It is an act by or under

the authority of the sovereign power. It is a police measure against
undesirable aliens whose presence in the country is found to be injurious to
the public good and domestic tranquility of the people" (Lao Gi vs. Court of
Appeals, supra). How could one who has helped the economy of the country
by providing employment to some 4,000 people be considered undesirable
and be summarily deported when the government, in its concerted drive to
attract foreign investors, grants Special Resident Visa to any alien who invest
at least US$50,000.00 in the country? Even assuming arguendo that
respondent is an alien, his deportation under the circumstances is unjust and
unfair, if not downright illegal. The action taken by petitioners in the case at
bar is diametrically opposed to settled government policy.

Petitioners, on the other hand, claim that respondent is an alien. In support

of their position, petitioners point out that Santiago Gatchalian's marriage
with Chu Gim Tee in China as well as the marriage of Francisco (father of
William) Gatchalian to Ong Chiu Kiok, likewise in China, were not supported
by any evidence other than their own self-serving testimony nor was there
any showing what the laws of China were. It is the postulate advanced by
petitioners that for the said marriages to be valid in this country, it should
have been shown that they were valid by the laws of China wherein the
same were contracted. There being none, petitioners conclude that the
aforesaid marriages cannot be considered valid. Hence, Santiago's children,
including Francisco, followed the citizenship of their mother, having been
born outside of a valid marriage. Similarly, the validity of the Francisco's
marriage not having been demonstrated, William and Johnson followed the
citizenship of their mother, a Chinese national.

After a careful consideration of petitioner's argument, We find that it cannot

be sustained.

In Miciano vs. Brimo (50 Phil. 867 [1924]; Lim and Lim vs. Collector of
Customs, 36 Phil. 472; Yam Ka Lim vs. Collector of Customs, 30 Phil. 46
[1915]), this Court held that in the absence of evidence to the contrary,
foreign laws on a particular subject are presumed to be the same as those of
the Philippines. In the case at bar, there being no proof of Chinese law
relating to marriage, there arises the presumption that it is the same as that
of Philippine law.

The lack of proof of Chinese law on the matter cannot be blamed on Santiago
Gatchalian much more on respondent William Gatchalian who was then a
twelve-year old minor. The fact is, as records indicate, Santiago was not
pressed by the Citizenship Investigation Board to prove the laws of China
relating to marriage, having been content with the testimony of Santiago
that the Marriage Certificate was lost or destroyed during the Japanese
occupation of China. Neither was Francisco Gatchalian's testimony subjected
to the same scrutiny by the Board of Special Inquiry. Nevertheless, the
testimonies of Santiago Gatchalian and Francisco Gatchalian before the
Philippine consular and immigration authorities regarding their marriages,
birth and relationship to each other are not self-serving but are admissible in
evidence as statements or declarations regarding family reputation or
tradition in matters of pedigree (Sec. 34, Rule 130). Furtheremore, this
salutary rule of evidence finds support in substantive law. Thus, Art. 267 of
the Civil Code provides:

Art. 267. In the absence of a record of birth, authentic document, final

judgment or possession of status, legitimate filiation may be proved by
any other means allowed by the Rules of Court and special laws. (See
also Art. 172 of the Family Code)

Consequently, the testimonies/affidavits of Santiago Gatchalian and

Francisco Gatchalian aforementioned are not self-serving but are competent
proof of filiation (Art. 172 [2], Family Code).

Philippine law, following the lex loci celebrationis, adheres to the rule that a
marriage formally valid where celebrated is valid everywhere. Referring to
marriages contracted abroad, Art. 71 of the Civil Code (now Art. 26 of the
Family Code) provides that "(a)ll marriages performed outside of the
Philippines in accordance with the laws in force in the country where they
were performed, and valid there as such, shall also be valid in this country . .
." And any doubt as to the validity of the matrimonial unity and the extent as
to how far the validity of such marriage may be extended to the
consequences of the coverture is answered by Art. 220 of the Civil Code in
this manner: "In case of doubt, all presumptions favor the solidarity of the
family. Thus, every intendment of law or facts leans toward the validity of
marriage, the indissolubility of the marriage bonds, the legitimacy of
children, the community of property during marriage, the authority of
parents over their children, and the validity of defense for any member of
the family in case of unlawful aggression." (Emphasis supplied). Bearing in
mind the "processual presumption" enunciated in Miciano and other cases,
he who asserts that the marriage is not valid under our law bears the burden
of proof to present the foreign law.

Having declared the assailed marriages as valid, respondent William

Gatchalian follows the citizenship of his father Francisco, a Filipino, as a
legitimate child of the latter. Francisco, in turn is likewise a Filipino being the
legitimate child of Santiago Gatchalian who (the latter) is admittedly a
Filipino citizen whose Philippine citizenship was recognized by the Bureau of
Immigration in an order dated July 12, 1960.

Finally, respondent William Gatchalian belongs to the class of Filipino citizens

contemplated under Sec. 1, Article IV of the Constitution, which provides:

Sec. 1. The following are citizens of the Philippines:

 (1) Those who are citizens of the Philippines at the time of the adoption
of this Constitution. . . .

This forecloses any further question about the Philippine citizenship of

respondent William Gatchalian.

The Court is not unaware of Woong Woo Yiu vs. Vivo (13 SCRA 552 [1965])
relied upon by petitioners. The ruling arrived thereat, however, cannot apply
in the case at bar for the simple reason that the parties therein testified to
have been married in China by a village leader, which undoubtedly is not
among those authorized to solemnize marriage as provided in Art. 56 of the
Civil Code (now Art. 7, Family Code).

Premises considered, the Court deems it unnecessary to resolve the other

issues raised by the parties.

WHEREFORE, G.R. Nos. 95122-23 is DISMISSED for lack of merit; G.R. Nos.
95612-13 is hereby GRANTED and respondent William Gatchalian is declared
a Filipino citizen. Petitioners are hereby permanently enjoined from
continuing with the deportation proceedings docketed as DC No. 90-523 for
lack of jurisdiction over respondent Gatchalian, he being a Filipino citizen;
Civil Cases No. 90-54214 and 3431-V-90 pending before respondent judges
are likewise DISMISSED. Without pronouncement as to costs.

SO ORDERED.

Gutierrez, Jr., Gancayco, Sarmiento, Griño-Aquino and Medialdea, JJ., concur.

Fernan, C.J., and Narvasa, J., concur in the result
29. Holy Spirit Homeowners Association v. Defensor (Aug. 2006)

GR 163980

- On 2003, Pres. Arroyo signed into law RA 9207 (The National Government
Center Housing and Land Utilization Act)

- The National Housing Authority (NHA) formulated the Implementing Rules

and Regulations (IRR) of RA 9207 which sought to effect the orderly
disposition of certain portions of the National Government Center Site,
located in Quezon City, to bona-fide residents. The IRR would then see to it
that portions of the East and West side of Commonwealth Avenue would be
open for disposition to bona-fide residents of the area.

- The Holy Spirit Homeowners Association seeks to prevent the respondents

from enforcing the IRR by a petition for prohibition

- The Office of the Solicitor General claims that the petition for prohibition is
an improper remedy because the writ does not lie against the exercise of
quasi-legislative functions

- Likewise, the OSG contends that the Homeowners Association violated the
doctrine of hierarchy of courts as it filed the petition with the Supreme Court
instead of the Court of Appeals

Issues & Held:

1. Whether the Doctrine of Exhaustion of Administrative Remedies is

applicable in this case?

NO

In questioning the validity or constitutionality of a rule or regulation issued

by an administrative agency, a party need not exhaust administrative
remedies before going to court. This principle, however, applies only where
the act of the administrative agency concerned was performed pursuant to
its quasi-judicial function, and not when the assailed act pertained to its rule-
making or quasi-legislative power.13

The assailed IRR was issued pursuant to the quasi-legislative power of the
Committee expressly authorized by R.A. No. 9207. The petition rests mainly
on the theory that the assailed IRR issued by the Committee is invalid on the
ground that it is not germane to the object and purpose of the statute it
seeks to implement.

2. Whether the Homeowners Association violated the doctrine of hierarchy

of courts?

YES
Since the regular courts have jurisdiction to pass upon the validity of the
assailed IRR issued by the Committee in the exercise of its quasi-legislative
power, the judicial course to assail its validity must follow the doctrine of
hierarchy of courts. Although the Supreme Court, Court of Appeals and the
Regional Trial Courts have concurrent jurisdiction to issue writs of certiorari,
prohibition, mandamus, quo warranto, habeas corpus and injunction, such
concurrence does not give the petitioner unrestricted freedom of
choice of court forum.

True, this Court has the full discretionary power to take cognizance of the
petition filed directly with it if compelling reasons, or the nature and
importance of the issues raised, so warrant. A direct invocation of the Court’s
original jurisdiction to issue these writs should be allowed only when there
are special and important reasons therefor, clearly and specifically set out in
the petition. In Heirs of Bertuldo Hinog v. Melicor, 455 SCRA 460 (2005), the
Court said that it will not entertain direct resort to it unless the redress
desired cannot be obtained in the appropriate courts, and exceptional and
compelling circumstances, such as cases of national interest and of serious
implications, justify the availment of the extraordinary remedy of writ of
certiorari, calling for the exercise of its primary jurisdiction.

Thus, following the doctrine of hierarchy of courts, the instant petition should
have been initially filed with the Regional Trial Court.

3. Whether a petition for prohibition is the proper remedy to assail the IRR?

NO.

A petition for prohibition is also not the proper remedy to assail an IRR issued
in the exercise of a quasi-legislative function. Prohibition is an extraordinary
writ directed against any tribunal, corporation, board, officer or person,
whether exercising judicial, quasi-judicial or ministerial functions, ordering
said entity or person to desist from further proceedings when said
proceedings are without or in excess of said entity’s or person’s jurisdiction,
or are accompanied with grave abuse of discretion, and there is no appeal or
any other plain, speedy and adequate remedy in the ordinary course of
law. Prohibition lies against judicial or ministerial functions, but not against
legislative or quasi-legislative functions. Generally, the purpose of a writ of
prohibition is to keep a lower court within the limits of its jurisdiction in order
to maintain the administration of justice in orderly channels. Prohibition is
the proper remedy to afford relief against usurpation of jurisdiction or power
by an inferior court, or when, in the exercise of jurisdiction in handling
matters clearly within its cognizance the inferior court transgresses the
bounds prescribed to it by the law, or where there is no adequate remedy
available in the ordinary course of law by which such relief can be obtained.
Where the principal relief sought is to invalidate an IRR, petitioners’ remedy
is an ordinary action for its nullification, an action which properly falls under
the jurisdiction of the Regional Trial Court. In any case, petitioners’ allegation
that “respondents are performing or threatening to perform functions
without or in excess of their jurisdiction” may appropriately be enjoined by
the trial court through a writ of injunction or a temporary restraining order.

4. Whether the IRR violates contradicts the statute (RA 9207)by fixing the
selling price of the lots?

NO.

Where a rule or regulation has a provision not expressly stated or contained

in the statute being implemented, that provision does not necessarily
contradict the statute—all that is required is that the regulation should be
germane to the objects and purposes of the law; that the regulation be not in
contradiction to but in conformity with the standards prescribed by the law;
Implicit in the authority of the Committee and the statute’s objective of
urban poor housing is the power of the Committee to formulate the manner
by which the reserved property may be allocated to the beneficiaries.

The Committee’s authority to fix the selling price of the lots may be likened
to the rate-fixing power of administrative agencies, and in case of a
delegation of rate-fixing power, the only standard which the legislature is
required to prescribe for the guidance of the administrative authority is that
the rate be reasonable and just.

There is nothing objectionable about prescribing a period within which the

parties must execute the contract to sell. This condition can ordinarily be
found in a contract to sell and is not contrary to law, morals, good customs,
public order, or public policy.

In subordinate legislation, as long as the passage of the rule or regulation

had the benefit of a hearing, the procedural due process requirement is
deemed complied with.

30. [G.R. No. 139382.June 19, 2001]

SEC. OF JUSTICE CUEVAS et al. vs.  ATTY. BACAL

EN BANC

Gentlemen:

Quoted hereunder, for your information, is a resolution of this Court

dated  JUN 19 2001.

G.R No. 139382 (The Secretary of Justice Serafin R. Cuevas, Executive

Secretary Ronaldo B. Zamora, and Atty. Carina J. Demaisip vs. Atty. Josefina
G. Bacal.)

Respondent Josefina G. Bacal moves for reconsideration of the decision of

December 6, 2000 dismissing her petition for quo warranto against petitioner
Carina Demaisip.Petitioners, who were required to comment on the motion,
asked for an extension, which is hereby granted, and the comment, which
they filed on April 20, 2001, is hereby admitted.It appears that on February
16, 2001, petitioner Demaisip retired as Chief Public Attorney, and in her
place, Persida V. Rueda-Acosta was appointed by President Gloria
Macapagal-Arroyo on February 19, 2001.

Respondent contends that Part III, Chap. I, Art. IV, par. 5(c) of the Integrated
Reorganization Plan, as adopted by P.D. No. 1, pursuant to which it was held
that appointments to the Career Executive Service (CES) should be made on
the basis of rank, has been repealed by Art. VII, §16 of the Constitution and
by the Administrative Code of 1987 (Book IV, Title III, Chapter 10, §§46-
47).The provision in question reads:

Appointment.Appointment to appropriate classes in the Career Executive

Service shall be made by the President from a list of career executive
eligibles recommended by the Board.Such appointments shall be made on
the basis of rank; provided  that appointment to the higher ranks which
qualify the incumbents to assignments as undersecretary and heads of
bureaus and offices and equivalent positions shall be with the confirmation of
the Commission on Appointments.The President may, however, in
exceptional cases, appoint any person who is not a Career Executive Service
eligible; provided that such appointee shall subsequently take the required
Career Executive Service examination and that he shall not be promoted to a
higher class until he qualifies in such examination. (emphasis added)

Respondent points out that appointments to the positions of

undersecretaries, heads of bureaus and offices, and other equivalent
positions are no longer required to be submitted to the Commission on
Appointments for confirmation.She argues that because of the repeal of the
abovequoted provision of the Integrated Reorganization Plan, appointments
to the CES should now be based on position and not on rank.

The contention has no merit.Art. VII, §16 of the Constitution has modified,
but not repealed, the provision of the Integrated Reorganization Plan
indicated by respondent insofar as appointments of undersecretaries and
heads of bureaus and offices and equivalent positions are concerned in the
sense that such appointments are no longer subject to confirmation by the
Commission on Appointments.But the rest of the provision in question
relative to other appointments to the CES remains effective.Consequently, as
provided in paragraphs 5(c) and (e), appointments, reassignments, and
transfers to the CES continue to be based on rank.

Moreover, with the retirement of petitioner Carina Demaisip, respondent's

action has become moot and academic.In actions for quo warranto, the
question is who between the parties is entitled to the contested position.If
any of the parties ceases from office, any decision rendered for one or the
other party cannot bind the successor in office (See Mendoza v. Allas, 302
SCRA 633 (1999)).In this case, petitioner Demaisip's retirement and the
subsequent appointment of Rueda-Acosta in her stead have rendered this
case moot and academic.

For the foregoing reasons, the Court RESOLVED to DENY with FINALITY the
motion for reconsideration.

Puno, J., joined by Vitug, and Gonzaga-Reyes, JJ., joined by Panganiban and

Quisumbing, JJ., maintain their dissents.Sandoval-Gutierrez, J., take no part.

31. G.R. No. L- 24548 October 27, 1983

WENCESLAO VlNZONS TAN, THE DIRECTOR OF FORESTRY, APOLONIO

THE SECRETARY OF AGRICULTURE AND NATURAL RESOURCES JOSE
Y. FELICIANO, respondents-appelllees,
vs.
THE DIRECTOR OF FORESTRY, APOLONIO RIVERA, THE SECRETARY
OF AGRICULTURE AND N ATURAL RESOURCES JOSE Y. FELICIANO,
respon dents-appellees,RAVAGO COMMERCIAL CO., JORGE LAO
HAPPICK and ATANACIO MALLARI, intervenors,

Camito V Pelianco Jr. for petitioner-appellant.

Solicitor General for respondent Director.

Estelito P. Mendoza for respondent Ravago Comm'l Co.

Anacleto Badoy for respondent Atanacio Mallari.

Mariano de Joya, Jr. for respondent Jorge Lao Happick, Jr.

MAKASIAR, J:

This is an appeal from the order dated January 20, 1965 of the then Court of
First Instance of Manila, Branch VII, in Civil Case No. 56813, a petition for
certiorari, prohibition and mandamus with preliminary prohibitory injunction
(p. 2. rec.), which dismissed the petition of petitioner-appellant Wenceslao
Vinzons Tan on the ground that it does not state a sufficient cause of action,
and upon the respondents-appellees' (Secretary of Agriculture and Natural
resources and the Director of Forestry) motion to dismiss (p. 28, rec.).

Sometime in April 1961, the Bureau of Forestry issued Notice No. 2087,
advertising for public bidding a certain tract of public forest land situated in
Olongapo, Zambales, provided tenders were received on or before May 22,
1961 (p. 15, CFI rec.). This public forest land, consisting of 6,420 hectares, is
located within the former U.S. Naval Reservation comprising 7,252 hectares
of timberland, which was turned over by the United States Government to
the Philippine Government (P. 99, CFI rec.).

On May 5, 1961, petitioner-appellant Wenceslao Vinzons Tan submitted his

application in due form after paying the necessary fees and posting tile
required bond therefor. Nine other applicants submitted their offers before
the deadline (p. 29, rec.).

Thereafter, questions arose as to the wisdom of having the area declared as

a forest reserve or allow the same to be awarded to the most qualified
bidder. On June 7, 1961, then President Carlos P. Garcia issued a directive to
the Director of the Bureau of Forestry, which read as follows:
 It is desired that the area formerly covered by the Naval
Reservation be made a forest reserve for watershed purposes.
Prepare and submit immediately a draft of a proclamation
establishing the said area as a watershed forest reserve for
Olongapo, Zambales. It is also desired that the bids received by
the Bureau of Forestry for the issuance of the timber license in
the area during the public bidding conducted last May 22, 1961
be rejected in order that the area may be reserved as above
stated. ...

(SGD.
)
CARL
OS P.
GARC
IA

(pp. 98, CFI rec.).

On August 3, 1961, Secretary Cesar M. Fortich of Agriculture and Natural

Resources sustained the findings and re comendations of the Director of
Forestry who concluded that "it would be beneficial to the public interest if
the area is made available for exploitation under certain conditions," and

We quote:

Respectfully forwarded to the honorable, the Executive Secretary

Malacanang. Manila inviting particular attention to the comment
and recommendation of the Director of Forestry in the
proceeding in indorsement in which this Of fice fully concurs.

The observations of responsible forest officials are most

revealing of their zeal to promote forest conservation and
watershed protection especially in Olongapo, Zambales area. In
convincing fashion, they have demonstrated that to declare the
forest area involved as a forest reserve ratify than open it for
timber exploitation under license and regulation would do more
harm than of to the public interest. To convert the area into a
forest reserve without an adequate forest protection force, would
make of it a 'Free Zone and Logging Paradise,' to the ever
'Problem Loggers' of Dinalupihan, Bataan . . . an open target of
timber smugglers, kaingineros and other forms of forest vandals
and despoilers. On the other hand, to award the area, as
planned, to a reputable and responsible licensee who shall
conduct logging operations therein under the selective logging
method and who shall be obliged to employ a sufficient number
 of forest guards to patrol and protect the forest consecration and
watershed protection.

Worthy of mention is the fact that the Bureau of Forestry had

already conducted a public bidding to determine the most
qualified bidder to whom the area advertised should be awarded.
Needless to stress, the decision of the Director of Forestry to
dispose of the area thusly was arrived at after much thought and
deliberation and after having been convinced that to do so would
not adversely affect the watershed in that sector. The result of
the bidding only have to be announced. To be sure, some of the
participating bidders like Mr. Edgardo Pascual, went to much
expense in the hope of winning a virgin forest concession. To
suddenly make a turn about of this decision without strong
justifiable grounds, would cause the Bureau of Forestry and this
Office no end of embarrassment.

In view of the foregoing, it is earnestly urged that the Director of

Forestry be allowed to proceed with the announcement of the
results of the bidding for the subject forest area (p. 13, CFI rec.).

The Office of the President in its 4th Indorsement dated February 2, 1962,
signed by Atty. Juan Cancio, Acting Legal Officer, "respectfully returned to
the Honorable Secretary of the Department of Agriculture and Natural
Resources for appropriate action," the papers subject of Forestry Notice No.
2087 which was referred to the Bureau of Forestry for decision (p. 14, CFI
rec.).

Finally, of the ten persons who submitted proposed the area was awarded to
herein petitioner-appellant Wenceslao Vinzons Tan, on April 15, 1963 by the
Bureau of Forestry (p. 17, CFI rec.). Against this award, bidders Ravago
Commercial Company and Jorge Lao Happick filed motions for
reconsideration which were denied by the Director of Forestry on December
6, 1963.

On May 30, 1963, the Secretary of Agriculture and Natural Resources

Benjamin M. Gozon — who succeeded Secretary Cesar M. Fortich in office —
issued General Memorandum Order No. 46, series of 1963, pertinent portions
of which state:

xxx xxx xxx

SUBJECT: ... ... ...

(D)elegation of authority to the Director of Forestry to grant

ordinary timber licenses.
 1. ... ... ...

2. The Director of Forestry is hereby authorized to grant (a) new

ordinary timber licenses where the area covered thereby is not
more than 3,000 hectares each; and (be the extension of
ordinary timber licenses for areas not exceeding 5,000 hectares
each;

3. This Order shall take effect immediately (p. 267, CFI rec.).

Thereafter, Jose Y. Feliciano was appointed as Acting secretary of Agriculture

and Natural Resources, replacing secretary Benjamin M. Gozon. Upon
assumption of office he Immediately promulgate on December 19, 19b3
General memorandum Order No. 60, revoking the authority delegated to the
Director of Forestry, under General Memorandum order No. 46, to grant
ordinary timber licenses, which order took effect on the same day, December
19, 1963. Pertinent portions of the said Order read as follows:

xxx xxx xxx

SUBJECT: Revocation of General Memorandum Order No 46

dated May 30, 1963 —

1. In order to acquaint the undersigned with the volume and

Nature of the work of the Department, the authority delegated to
the Director of forestry under General Memorandum Order No.
46, dated May 30, 1963, to grant (a) new ordinary timber
licenses where the area covered thereby is not more than 3,000
hectares each; and (b) the extension of ordinary timber licenses
for areas not exceeding 3,000 hectares each is hereby
revoked. Until further notice, the issuance of' new licenses ,
including amendments thereto, shall be signed by the secretary
of Agriculture and Natural Resources.

2. This Order shall take effect immediately and all other previous
orders, directives, circulars, memoranda, rules and regulations
inconsistent with this Order are hereby revoked (p. 268, CFl rec.;
Emphasis supplied).

On the same date that the above-quoted memorandum took effect,

December 19, 1963, Ordinary Timber License No. 20-'64 (NEW) dated April
22, 1963, in the name of Wenceslao Vinzons Tan, was signed by then Acting
Director of Forestry Estanislao R. Bernal without the approval of the
Secretary of Agriculture and Natural Resources. On January 6, 1964, the
license was released by the Office of the Director of Forestry (p. 30, CFI rec.;
p. 77, rec.). It was not signed by the Secretary of Agriculture and Natural
Resources as required by Order No. 60 aforequoted.

On February 12, 1964, Ravago Commercial Company wrote a letter to the

Secretary of Agriculture and Natural Resources shall be considered by tile
Natural Resources praying that, pending resolution of the appeal filed by
Ravago Commercial Company and Jorge Lao Happick from the order of the
Director of Forestry denying their motion for reconsideration, OTI No. 20-'64
in the name of Wenceslao V. Tan be cancelled or revoked on the ground that
the grant thereof was irregular, anomalous and contrary to existing forestry
laws, rules and regulations.

On March 9, 1964, acting on the said representation made by Ravago

Commercial Company, the Secretary of Agriculture and Natural Resources
promulgated an order declaring Ordinary Timber License No. 20-'64 issued in
the name of Wenceslao Vinzons Tan, as having been issued by the Director
of Forestry without authority, and is therefore void ab initio. The dispositive
portion of said order reads as follows:

WHEREFORE, premises considered, this Office is of the opinion

and so holds that O.T. License No. 20-'64 in the name of
Wenceslao Vinzons Tan should be, as hereby it is, REVOKED AND
DECLARED without force and effect whatsoever from the
issuance thereof.

The Director of Forestry is hereby directed to stop the logging

operations of Wenceslao Vinzons Tan, if there be any, in the area
in question and shall see to it that the appellee shall not
introduce any further improvements thereon pending the
disposition of the appeals filed by Ravago Commercial Company
and Jorge lao Happick in this case" (pp. 30-31, CFI rec.).

Petitioner-appellant moved for a reconsideration of the order, but the

Secretary of Agriculture and Natural Resources denied the motion in an
Order dated March 25, 1964, wherein this paragraph appears:

In this connection, it has been observed by the Acting Director of

Forestry in his 2nd indorsement of February 12, 1964, that the
area in question composes of water basin overlooking Olongapo,
including the proposed Olongapo watershed Reservation; and
that the United States as well as the Bureau of Forestry has
earmarked this entire watershed for a watershed pilot forest for
experiment treatment Concerning erosion and water
conservation and flood control in relation to wise utilization of
the forest, denudation, shifting cultivation, increase or decrease
 of crop harvest of agricultural areas influenced by the watershed,
etc. .... (pp. 3839, CFI rec.; p. 78, rec.).

On April 11, 1964, the Secretary of Agriculture and Natural Resources, acting
on the separate appeals filed by Jorge Lao Happick and Ravago Commercial
Company, from the order of the Director of Forestry dated April 15, 1963,
awarding to Wenceslao Vinzons Tan the area under Notive No. 2087, and
rejecting the proposals of the other applicants covering the same area,
promulgated an order commenting that in view of the observations of the
Director of Forestry just quoted, "to grant the area in question to any of the
parties herein, would undoubtedly adversely affect public interest which is
paramount to private interests," and concluding that, "for this reason, this
Office is of the opinion and so holds, that without the necessity of discussing
the appeals of the herein appellants, the said appeals should be, as hereby
they are, dismissed and this case is considered a closed matter insofar as
this Office is concerned" (p. 78, rec.).

On April 18, 1964, on the basis of the denial of his motion for reconsideration
by the Secretary of Agriculture and Natural Resources, petitioner-appellant
filed the instant case before tile court a quo (Court of First Instance, Manila),
Special Civil Action No. 56813, a petition for certiorari, prohibition and
mandamus with preliminary prohibitory injunction (pp. 1-12, CFI rec.).
Petitioner-appellant claims that the respondents-appellees "unlawfully,
illegally whimsically, capriciously and arbitrarily acted without or in excess of
their jurisdiction, and/or with grave abuse of discretion by revoking a valid
and existing timber license without just cause, by denying petitioner-
appellant of the equal protection of the laws, by depriving him of his
constitutional right to property without due process of law, and in effect, by
impairing the obligation of contracts" (P. 6, CFI rec.). Petitioner-appellant
prayed for judgment making permanent the writ of preliminary injunction
against the respondents- appellees; declaring the orders of the Secretary of
Agriculture and Natural Resources dated March 9, March 25, and April 11,
1964, as well as all his acts and those of the Director of Forestry
implementing said orders, and all the proceedings in connection therewith,
null and void, unlawful and of no force and effect; ordering the Director of
Forestry to renew OTI No. 20-'64 upon expiration, and sentencing the
respondents, jointly and severally, to pay the petitioner-appellant the sum of
Two Hundred Thousand Pesos (P200,000.000) by way of pecuniary damage,
One Hundred Thousand Pesos (P100,000.00) by way of moral and exemplary
damages, and Thirty Thousand Pesos (P30,000-00) as attorney's fees and
costs. The respondents-appellees separately filed oppositions to the issuance
of the writ of preliminary injunction, Ravago Commercial Company, Jorge
Lao, Happick and Atanacio Mallari, presented petitions for intervention which
were granted, and they too opposed the writ.
The Director of Forestry in his motion to dismiss dated April 24, 1964, alleges
the following grounds: (1) that the court has no jurisdiction; (2) that the
respondents may not be sued without their consent; (3) that the petitioner
has not exhausted all available administrative remedies; (4) that the petition
does not state a cause of action; and (5) that purely administrative and
discretionary functions of administrative officials may not be interfered with
by the courts. The Secretary of Agriculture and Natural Resources joined the
motion to dismiss when in his answer of May 18, 1964, he avers the following
special and affirmative defenses: (1) that the court has no jurisdiction to
entertain the action for certiorari, prohibition and mandamus; (2) that the
petitioner has no cause of action; (3) that venue is improperly laid; (4) that
the State is immune from suit without its consent; (5) that the court has no
power to interfere in purely administrative functions; and (6) that the
cancellation of petitioner's license was dictated by public policy (pp. 172-
177, rec.). Intervenors also filed their respective answers in intervention with
special and affirmative defenses (pp. 78-79, rec.). A hearing was held on the
petition for the issuance of writ of preliminary injunction, wherein evidence
was submitted by all the parties including the intervenors, and extensive
discussion was held both orally and in writing.

After the said hearing, on January 20, 1965, the court a quo, from the
evidence received, resolved not only the question on the issuance of a writ of
preliminary injunction but also the motion to dismiss, declared that the
petition did not state a sufficient cause of action, and dismissed the same
accordingly. To justify such action, the trial court, in its order dismissing the
petition, stated that "the court feels that the evidence presented and the
extensive discussion on the issuance of the writ of preliminary mandatory
and prohibitory injunction should also be taken into consideration in
resolving not only this question but also the motion to dismiss, because
there is no reason to believe that the parties will change their stand,
arguments and evidence" (p. 478, CFI rec.). His motion for reconsideration
having been denied (p. 488, CFI rec.), petitioner-appellant Wenceslao
Vinzons Tan appealed directly to this Court.

Petitioner-appellant now comes before this Court, claiming that the trial
court erred in:

(1) holding that the petition does not state a sufficient cause of
action: and

(2) dismissing the petition [p.27,rec. ].

He argues that the sole issue in the present case is, whether or not the facts
in the petition constitute a sufficient cause of action (p. 31, rec.). Petitioner-
appellant, in his brief, presented a lengthy discussion on the definition of the
term cause of action wherein he contended that the three essential elements
thereon, — namely, the legal right of the plaintiff, the correlative obligation
of the defendants and the act or omission of the defendant in violation of
that right — are satisfied in the averments of this petition (pp. 31-32, rec.).
He invoked the rule that when the ground for dismissal is that the complaint
states no cause of action, such fact can be determined only from the facts
alleged in the complaint and from no other, and the court cannot consider
other matters aliunde He further invoked the rule that in a motion to dismiss
based on insufficiency of cause of action, the facts alleged in the complaint
are deemed hypothetically admitted for the purpose of the motion (pp. 32-
33, rec.).

A perusal of the records of the case shows that petitioner-appellant's

contentions are untenable. As already observed, this case was presented to
the trial court upon a motion to dismiss for failure of the petition to state a
claim upon which relief could be granted (Rule 16 [g], Revised Rules of
Court), on the ground that the timber license relied upon by the petitioner-
appellant in his petition was issued by the Director of Forestry without
authority and is therefore void ab initio. This motion supplanted the general
demurrer in an action at law and, as a rule admits, for the purpose of the
motion, ail facts which are well pleaded however while the court must accept
as true all well pleaded facts, the motion does not admit allegations of which
the court will take judicial notice are not true, nor does the rule apply to
legally impossible facts, nor to facts inadmissible in evidence, nor to facts
which appear by record or document included in the pleadings to be
unfounded (Vol. 1, Moran's Comments on the Rules of Court, 1970 ed., p.
505, citing cases).

It must be noted that there was a hearing held in the instant case wherein
answers were interposed and evidence introduced. In the course of the
hearing, petitioner-appellant had the opportunity to introduce evidence in
support of tile allegations iii his petition, which he readily availed of.
Consequently, he is estopped from invoking the rule that to determine the
sufficiency of a cause of action on a motion to dismiss, only the facts alleged
in the complaint must be considered. If there were no hearing held, as in the
case of Cohen vs. U.S. CCA Minn 1942,129 F. 2d 733), "where the case was
presented to District Court upon a motion to dismiss because of alleged
failure of complaint to state a claim upon which relief could be granted, and
no answer was interposed and no evidence introduced, the only facts which
the court could properly consider in passing upon the motion were those
facts appearing in the complaint, supplemented be such facts as the court
judicially knew.

In Llanto vs. Ali Dimaporo, et al. (16 SCRA 601, March 31, 1966), this Court,
thru Justice Conrado V. Sanchez, held that the trial court can properly
dismiss a complaint on a motion to dismiss due to lack of cause of action
even without a hearing, by taking into consideration the discussion in said
motion and the opposition thereto. Pertinent portion of said decision is
hereby quoted:

Respondents moved to dismiss. Ground therefor is lack of cause

of action. The Court below granted the motion, dismissed the
petition. The motion to reconsider failed. Offshoot is this appeal.

1. The threshold questions are these: Was the

dismissal order issued without any hearing on the
motion to dismiss? Is it void?

WE go to the record. The motion to dismiss was filed on February

1, 1961 and set for hearing on February 10 following. On
February 8, 1961 petitioner's counsel telegraphed the court,
(r)equest postponement motion dismissal till written opposition
filed.' He did not appear at the scheduled hearing. But on March
4, 1961, he followed up his wire, with his written opposition to
the motion to dismiss. Adverting to the 5-page motion to dismiss
and the 6-page opposition thereto, We find that the arguments
pro and con on the question of the board's power to abolish
petitioner's position to discussed the problem said profusely
cited authorities. The May 15, 1961 8-page court order recited at
length the said arguments and concluded that petitioner made
no case.

One good reason for the statutory requirement of hearing on a

motion as to enable the suitors to adduce evidence in support of
their opposing claims. But here the motion to dismiss is
grounded on lack of cause of action. Existence of a cause of
action or lack of it is determined be a reference to the facts
averred in the challenged pleading. The question raised in the
motion is purely one of law. This legal issue was fully discussed
in said motion and the opposition thereto. In this posture, oral
arguments on the motion are reduced to an unnecessary
ceremony and should be overlooked. And, correctly so, because
the other intendment of the law in requiring hearing on a motion,
i.e., 'to avoid surprises upon the opposite party and to give to the
latter time to study and meet the arguments of the motion,' has
been sufficiently met. And then, courts do not exalt form over
substance (Emphasis supplied).

Furthermore even if the complaint stated a valid cause of action, a motion to

dismiss for- insufficiency of cause of action will be granted if documentary
evidence admitted by stipulation disclosing facts sufficient to defeat the
claim enabled the court to go beyond disclosure in the complaint (LOCALS
No. 1470, No. 1469, and No. 1512 of the International Longshoremen's
Association vs. Southern Pacific Co., 6 Fed. Rules Service, p. 107; U.S. Circuit
Court of Appeals, Fifth Circuit, Dec. 7, 1952; 131 F. 2d 605). Thus, although
the evidence of the parties were presented on the question of granting or
denying petitioner-appellant's application for a writ of preliminary injunction,
the trial court correctly applied said evidence in the resolution of the motion
to dismiss. Moreover, in applying said evidence in the resolution of the
motion to dismiss, the trial court, in its order dismissing the petition, pointed
out that, "there is no reason to believe that the parties will change their
stand, arguments and evidence" (p. 478, CFI rec.). Petitioner-appellant did
not interpose any objection thereto, nor presented new arguments in his
motion for reconsideration (pp. 482-484, CFI rec.). This omission means
conformity to said observation, and a waiver of his right to object, estopping
him from raising this question for the first time on appeal. " I question not
raised in the trial court cannot be raised for the first time on appeal"
(Matienzo vs. Servidad, Sept. 10, 1981, 107 SCRA 276).

Moreover, petitioner-appellant cannot invoke the rule that, when the ground
for asking dismissal is that the complaint states no cause of action, its
sufficiency must be determined only from the allegations in the complaint.
"The rules of procedure are not to be applied in a very rigid, technical sense;
rules of procedure are used only to help secure substantial justice. If a
technical and rigid enforcement of the rules is made, their aim would be
defeated. Where the rules are merely secondary in importance are made to
override the ends of justice; the technical rules had been misapplied to the
prejudice of the substantial right of a party, said rigid application cannot be
countenanced" (Vol. 1, Francisco, Civil Procedure, 2 ed., 1973, p. 157, citing
cases).

What more can be of greater importance than the interest of the public at
large, more particularly the welfare of the inhabitants of Olongapo City and
Zambales province, whose lives and properties are directly and immediately
imperilled by forest denudation.

The area covered by petitioner-appellant's timber license practically

comprises the entire Olongapo watershed (p. 265, CFI rec.). It is of public
knowledge that watersheds serves as a defense against soil erosion and
guarantees the steady supply of water. As a matter of general policy, the
Philippine Constitution expressly mandated the conservation and proper
utilization of natural resources, which includes the country's watershed.
Watersheds in the Philippines had been subjected to rampant abusive
treatment due to various unscientific and destructive land use practices.
Once lush watersheds were wantonly deforested due to uncontrolled timber
cutting by licensed concessionaries and illegal loggers. This is one reason
why, in paragraph 27.of the rules and regulations included in the ordinary
timber license it is stated:

The terms and conditions of this license are subject to change at

the discretion of the Director of Forestry, and that this license
may be made to expire at an earlier date, when public interests
so require (Exh. D, p. 22, CFI rec.).

Considering the overriding public interest involved in the instant case, We

therefore take judicial notice of the fact that, on April 30, 1964, the area
covered by petitioner-appellant's timber license has been established as the
Olongapo Watershed Forest Reserve by virtue of Executive Proclamation No.
238 by then President Diosdado Macapagal which in parts read as follows:

Pursuant to the provisions of Section 1824 of the Revised

Administrative Code, as amended, 1, Diosdado Macapagal,
President of the Philippines do hereby withdraw from entry, sale,
or settlement and establish as Olongapo Watershed Forest
Reserve for watershed, soil protection, and timber production
purposes, subject to private rights, if any there be, under the
administration and control of the Director of Forestry, xx the
following parcels of land of the public domain situated in the
municipality of Olongapo, province of Zambales, described in the
Bureau of Forestry map No. FR-132, to wit: ... ... (60 O.G. No. 23,
3198).

Petitioner-appellant relies on Ordinary Timber License No. 20-'64 (NEW) for

his alleged right over the timber concession in question. He argues thus:
"The facts alleged in the petition show: (1) the legal right of the petitioner to
log in the area covered by his timber license; (2) the legal or corresponding
obligation on the part of the respondents to give effect, recognize and
respect the very timber license they issued to the petitioner; and (3) the act
of the respondents in arbitrarily revoking the timber license of the petitioner
without giving him his day in court and in preventing him from using and
enjoying the timber license issued to him in the regular course of official
business" (p. 32, rec.).

In the light of petitioner-appellant's arguments, it is readily seen that the

whole controversy hinges on the validity or invalidity of his timber license.

WE fully concur with the findings of the trial court that petitioner- appellant's
timber license was signed and released without authority by then Acting
Director Estanislao R. Bernal of Forestry, and is therefore void ab initio. WE
hereby quote such findings:
 In the first place, in general memorandum order No. 46 dated
May 30, 1963, the Director of Forestry was authorized to grant a
new ordinary timber license only where the area covered thereby
was not more than 3,000 hectares; the tract of public forest
awarded to the petitioner contained 6,420 hectares (Exhs. 2-A
and 2-B Ravago, embodied in Annex B; Exh. B). The petitioner
contends that only 1,756 hectares of the said area contain
commercial and operable forest; the authority given to the
Director of Forestry to grant a new ordinary timber license of not
more than 3,000 hectares does not state that the whole area
should be commercial and operable forest. It should be taken
into consideration that the 1,756 hectares containing commercial
and operable forest must have been distributed in the whole
area of 6,420 hectares. Besides the license states, 'Please see
attached sketch and technical description,' gives an area of
6,420 hectares and does not state what is the area covered of
commmercial and operable forest (Exh. Ravago Also Annex B of
the petition, which was marked as Exhibit B, states:

Under Notice No. 2087, a tract of public forest

containing 6,420 hectares located in Olongapo,
Zambales was declared available for timber
utilization and development. Pursuant to this Notice,
there were received bid proposals from the following
persons: ...

Wherefore, confirming the findings of said Committee, the area

described in Notice No. 2087 shall be awarded, as it is hereby
awarded to Wenceslao Vinzons Tan, subject to the following
conditions: ... ...

In the second place, at the time it was released to the petitioner,

the Acting Director of Forestry had no more authority to grant
any license. The license was signed by the Acting Director of
Forestry on December 19, 1963, and released to the petitioner
on January 6, 1964 (Exh. RavaGo The authority delegated to the
Director of Forestry to grant a new ordinary timber license was
contained in general memorandum order No. 46 dated May 30,
1963. This was revoked by general memorandum order No. 60,
which was promulgated on December 19, 1963. In view thereof,
the Director of Forestry had no longer any authority to release
the license on January 6, 1964, and said license is therefore
void ab initio (pp. 479480, CFI rec.).

The release of the license on January 6, 1964, gives rise to the impression
that it was ante-dated to December 19, 1963 on which date the authority of
the Director of Forestry was revoked. But, what is of greatest importance is
the date of the release or issuance, and not the date of the signing of the
license. While petitioner-appellant's timber license might have been signed
on December 19, 1963 it was released only on January 6, 1964. Before its
release, no right is acquired by the licensee. As pointed out by the trial court,
the Director of Forestry had no longer any authority to release the license on
January 6, 1964. Therefore, petitioner-appellant had not acquired any legal
right under such void license. This is evident on the face of his petition as
supplemented by its annexes which includes Ordinary Timber License No.
20-'64 (NEW). Thus, in the case of World Wide Insurance & Surety Co., Inc.
vs. Macrohon, et al. (105 Phil. 250, Feb. 28, 1959), this Court held that if
from the face of the complaint, as supplemented by its annexes, plaintiff is
not the owner, or entitled to the properties it claims to have been levied
upon and sold at public auction by the defendants and for which it now seeks
indemnity, the said complaint does not give plaintiff any right of action
against the defendants. In the same case, this Court further held that, in
acting on a motion to dismiss, the court cannot separate the complaint from
its annexes where it clearly appears that the claim of the plaintiff to be the A
owner of the properties in question is predicated on said annexes.
Accordingly, petitioner-appellant's petition must be dismissed due to lack of
cause of action.

II

Petitioner-appellant, in his petition, alleged that he has exhausted all his

administrative remedies to no avail as respondents-appellees have failed,
neglected, refused and continue to refuse to allow petitioner-appellant to
continue operation in the area covered by his timber license. He further
alleged that he has neither recourse by way of appeal, nor any plain, speedy
and adequate remedy in the ordinary course of law except thru this special
civil action, as the last official act of the respondent-appellee Secretary of
Agriculture and Natural Resources in declaring void the timber license
referred to above after denying petitioner-appellant's motion for
reconsideration, is the last administrative act. Petitioner-appellant relies on
the case of Demaisip vs. The Court of Appeals, et al. (106 Phil. 237, Sept. 24,
1959), wherein it was held that the failure of the plaintiff to appeal from the
adverse decision of the Secretary to the President cannot preclude the
plaintiff from taking court action in view of the theory that the Secretary of a
department is merely an alter-ego of the President. The presumption is that
the action of the Secretary bears the implied sanction of the President unless
the same is disapproved by the latter (Villena vs. the Secretary of Interior, 67
Phil. 451; p. 7, CFI rec.).

To this We cannot agree. Petitioner-appellant did not appeal the order of the
respondent Secretary of Agriculture and Natural Resources to the President
of the Philippines, who issued Executive Proclamation No. 238 withdrawing
the area from private exploitation, and establishing it as the Olongapo
Watershed Forest Reserve. Considering that the President has the power to
review on appeal the orders or acts of the respondents-appellees, the failure
of the petitioner-appellant to take that appeal is failure on his part to exhaust
his administrative remedies. Thus, this Court, in the case of Calo vs. Fuertes
(5 SCRA 399, 400, June 29, 1962), held that:

At any rate, the appellant's contention that, as the Secretary of

Agriculture and Natural Resources is the alter ego of the
President and his acts or decisions are also those of the latter, he
need not appeal from the decision or opinion of the former to the
latter, and that, such being the case, after he had appealed to
the Secretary of Agriculture and Natural Resources from the
decision or opinion of the Director of Lands he had exhausted the
administrative remedies, is untenable.

The withdrawal of the appeal taken to the President of the

Philippines is tantamount to not appealing all thereto. Such
withdrawal is fatal, because the appeal to the President is the
last step he should take in an administrative case.

In 1912, in the case of Lamb vs. Phipps (22 Phil. 491-92, July 22, 1912), this
Court stressed the doctrine of exhaustion of administrative remedies, thus:

When a plain, adequate and speedy remedy is afforded by and

within the executive department of the government the courts
will not interfere until at least that remedy has been exhausted.
Jao Igco vs. Shuster, 10 Phil. Rep. 448; Ekiu vs. U.S., 142 U.S.
651; U.S. vs. Sing Tuck, 194 U.S. 161; U.S. vs. Ju Toy 198 U.S.
253; Chill Yow vs. U.S., 28 Sup. Ct. Rep. 201). The administrative
remedies afforded by law must first be exhausted before resort
can be had to the courts, especially when the administrative
remedies are by law exclusive and final. Some matters and some
questions are by law delegated entirely and absolutely to the
discretion of particular branches of the executive department of
the government. When the law confers exclusive and final
jurisdiction upon the executive department of the government to
dispose of particular questions, their judgments or the judgments
of that particular department are no more reviewable by the
courts than the final judgment or decisions of the courts are
subject to be reviewed and modified by them" (emphasis
supplied).

Moreover, this being a special civil action, petitioner-appellant must allege

and prove that he has no other speedy and adequate remedy (Diego vs. The
Court of Appeals, et al., 54 Off. Gaz., No. 4, 956). In the case at bar,
petitioner- appellant's speedy and adequate remedy is an appeal to the
President of the Philippines.

Accordingly, "it is settled to the point of being elementary that the only
question involved n certiorari is jurisdiction, either want of jurisdiction or
excess thereof, and abuse of discretion shall warrant the issuance of the
extraordinary remedy of certiorari when the same is so grave as when the
power is exercised in an arbitrary or despotic manner by reason of passion,
prejudice or personal hostility, and it must be so patent and gross as to
amount to an evasion of positive duty, or to a virtual refusal to perform a
duty enjoined, or to act at all in contemplation of law" FS Divinagracia Agro-
Commercial Inc. vs. Court of Appeals, 104 SCRA 191 [April .1, 1981]). The
foregoing is on the assumption that there is any irregularity, albeit there is
none in the acts or omissions of the respondents-appellees. certiorari is not a
substitute for appeal as held time and again by this Court (People vs.
Villanueva, 110 SCRA 465), "it being a time honored and well known
principle that before seeking judicial redress, a party must first exhaust the
administrative remedies available" (Garcia vs. Teehankee, 27 SCRA 944,
April 18, 1969).

Moreover, from the decision of the Secretary of Agriculture and Natural

Resources complained of, petitioners had a plain, speedy and adequate
remedy by appealing therefrom to the Chief Executive. In other words,
before filing the present action for certiorari in the court below, they should
have availed of this administrative remedy and their failure to do so must be
deemed fatal to their case [Calo vs. Fuertes, et al., G.R. No. L-16537, June
29,1962]. To place petitioners' case beyond the pale of this rule, they must
show that their case falls — which it does not — within the cases where, in
accordance with our decisions, the aggrieved party need not exhaust
administrative remedies within his reach in the ordinary course of the law
[Tapales vs. The President and the Board of Regents of the U.P., G.R. No. L-
17532, March 30, 1963; Mangubat vs. Osmena, G.R. No. L- 12837, April 30,
1959; Baguio vs. Hon. Jose Rodriguez, G. R. No. L-11078, May 27, 1959;
Pascual vs. Provincial Board, G.R. No. L-11959, Oct. 31, 1959; Marinduque
Iron Mines, etc. vs. Secretary of Public Works, G.R. No. L-15982, May 31,
1963; Alzate vs. Aldaba, G.R. No. L-14407, Feb. 29, 1960 and Demaisip vs.
Court of Appeals, G.R. No. L- 13000, Sept. 25, 1959] (Ganob vs. Ramas, 27
SCRA 1178, April 28, 1969).

III

Petitioner-appellant not only failed to exhaust his administrative remedies,

but also failed to note that his action is a suit against the State which, under
the doctrine of State immunity from suit, cannot prosper unless the State
gives its consent to be sued Kawananakoa vs. Polybank, 205 U.S. 349; Siren
vs. U.S., 7 Wall. 152; Sec. 16, Art. XV, 1973 Constitution).
The respondents-appellees, in revoking the petitioner-appellant's timber
license, were acting within the scope of their authority. Petitioner-appellant
contends that "this case is not a suit against the State but an application of a
sound principle of law whereby administrative decisions or actuations may
be reviewed by the courts as a protection afforded the citizens against
oppression" (p. 122, CFI rec.). But, piercing the shard of his contention, We
find that petitioner-appellant's action is just an attempt to circumvent the
rule establishing State exemption from suits. He cannot use that principle of
law to profit at the expense and prejudice of the State and its citizens. The
promotion of public welfare and the protection of the inhabitants near the
public forest are property, rights and interest of the State. Accordingly, "the
rule establishing State exeraiption from suits may not be circumvented by
directing the action against the officers of the State instead of against the
State itself. In such cases the State's immunity may be validly invoked
against the action as long as it can be shown that the suit really affects the
property, rights, or interests of the State and not merely those of the officer
nominally made party defendant" (SINCO, Phil. Political Law, 10th ed., p. 35;
Salgado vs. Ramos, 64 Phil. 724; see also Angat River Irrigation System vs.
Angat River Workers' Union, G.R. No. L-10943-44, Dec. 28, 1957, 102 Phil.
789, 800-802; Mobil PhiL vs. Customs Arrastre Service, 18 SCRA 1120, 1121-
1125; Bureau of Printing vs. Bureau of Printing Employees' Association, 1
SCRA 340, 341, 343).

Both the Secretary of Agriculture and Natural Resources and the Director of
Forestry acted in their capacity as officers of the State, representatives of
the sovereign authority discharging governmental powers. A private
individual cannot issue a timber license.

Consequently, a favorable judgment for the petitioner-appellant would result

in the government losing a substantial part of its timber resources. This
being the case, petitioner-appellant's action cannot prosper unless the State
gives its consent to be sued.

IV

Granting arguendo, that petitioner-appellant's timber license is valid, still

respondents-appellees can validly revoke his timber license. As pointed out
earlier, paragraph 27 of the rules and regulations included in the ordinary
timber license states: "The terms and conditions of this license are subject to
change at the discretion of the Director of Forestry, and that this license may
be made to expire at an earlier date, when public interests so require" (Exh.
D, p. 22, CFI rec.). A timber license is an instrument by which the State
regulates the utilization and disposition of forest resources to the end that
public welfare is promoted. A timber license is not a contract within the
purview of the due process clause; it is only a license or privilege, which can
be validly withdrawn whenever dictated by public interest or public welfare
as in this ceise

"A license is merely a permit or privilege to do what otherwise would be

unlawful, and is not a contract between the authority, federal, state, or
municipal, granting it and the person to whom it is granted; neither is it
property or a property right, nor does it create a vested right; nor is it
taxation" (37 C.J. 168). Thus, this Court held that the granting of license does
not create irrevocable rights, neither is it property or property rights (People
vs. Ong Tin 54 O.G. 7576). In the case of Pedro vs. Provincial Board of Rizal
(56 Phil. 123), it was held that:

A license authorizing the operation and exploitation of a cockpit

is not property of which the holder may not be deprived without
due process of law, but a mere privilege which may be revoked
when public interests so require.

The welfare of the people is the supreme law. Thus, no franchise or right can
be availed of to defeat the proper exercise of police power (Surigao Electric
Co., Inc. vs. Municipality of Surigao, 24 SCRA 898, Aug. 30, 1968). The State
has inherent power enabling it to prohibit all things hurtful to comfort, safety,
and welfare of society (Edu vs. Ericta, 35 SCRA 481, Oct. 24,1970).

As provided in the aforecited provision, timber licenses are subject to the

authority of the Director of Forestry. The utilization and disposition of forest
resources is directly under the control and supervision of the Director of
Forestry. However, "while Section 1831 of the Revised Administrative Code
provides that forest products shall be cut, gathered and removed from any
forest only upon license from the Director of Forestry, it is no less true that
as a subordinate officer, the Director of Forestry is subject to the control of
the Department Head or the Secretary of Agriculture and Natural Resources
(See. 79[c], Rev. Adm. Code), who, therefore, may impose reasonable
regulations in the exercise of the powers of the subordinate officer" (Director
of Forestry vs. Benedicto, 104 SCRA 309, May 5, 1981). The power of control
of the Department Head over bureaus and offices includes the power to
modify, reverse or set aside acts of subordinate officials (Province of
Pangasinan vs. Secretary of Public Works and Communications, 30 SCRA
134, Oct. 31, 1969; Montano vs. Silvosa, 97 Phil. 143, 144, 147-148).
Accordingly, respondent-appellee Secretary of Agriculture and Natural
Resources has the authority to revoke, on valid grounds, timber licenses
issued by the Director of Forestry. There being supporting evidence, the
revocation of petitioner-appellant's timber license was a wise exercise of the
power of the respondent- appellee (Secretary of Agriculture and Natural
Resources) and therefore, valid.
Thus, "this Court had rigorously adhered to the principle of conserving forest
resources, as corollary to which the alleged right to them of private
individuals or entities was meticulously inquired into and more often than not
rejected. We do so again" (Director of Forestry vs. Benedicto, supra). WE
reiterate Our fidelity to the basic policy of conserving the national patrimony
as ordained by the Constitution.

WHEREFORE, IN VIEW OF ALL THE FOREGOING, THE ORDER APPEALED FROM

IS HEREBY .AFFIRMED IN TOTO. COSTS AGAINST PETITIONER-APPELLANT.

SO ORDERED,

Concepcion Jr., Guerrero, Abad Santos and Escolin, JJ., concur.

Aquino, J, concurs in the result.

De Castro, JJ., is on leave.

32. G.R. Nos. 197592 & 20262               November 27, 2013

THE PROVINCE OF AKLAN, Petitioner,

vs.
JODY KING CONSTRUCTION AND DEVELOPMENT CORP., Respondent.

DECISION

VILLARAMA, JR., J.:

These consolidated petitions for review on certiorari seek to reverse and set
aside the following: (1) Decision 1 dated October 18, 2010 and
Resolution2 dated July 5, 2011 of the Court of Appeals (CA) in CA-G.R. SP No.
111754; and (2) Decision3 dated August 31, 2011 and Resolution 4 dated June
27, 2012 in CA-G.R. SP No. 114073.

The Facts

On January 12, 1998, the Province of Aklan (petitioner) and Jody King
Construction and Development Corp. (respondent) entered into a contract for
the design and -construction of the Caticlan Jetty Port and Terminal (Phase I)
in Malay, Aklan. The total project cost is ₱38,900,000: P 18,700,000 for the
design and construction of passenger terminal, and ₱20,200,000 for the
design and construction of the jetty port facility. 5 In the course of
construction, petitioner issued variation/change orders for additional works.
The scope of work under these change orders were agreed upon by
petitioner and respondent.6
On January 5, 2001, petitioner entered into a negotiated contract with
respondent for the construction of Passenger Terminal Building (Phase II)
also at Caticlan Jetty Port in Malay, Aklan. The contract price for Phase II is
₱2,475,345.54.7

On October 22, 2001, respondent made a demand for the total amount of
₱22,419,112.96 covering the following items which petitioner allegedly failed
to settle:

1. Unpaid accomplishments on additional works

undertaken - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Php
12,396,143.09

2. Refund of taxes levied despite it not being

covered by original contract- - - - - - - - - - - - - - - - - - - - - - Php
884,098.59

3. Price escalation (Consistent with Section 7.5,

Original Contract- - - - - - - - - - - - - - - - - - - - - - - - - - - - Php
1,291,714.98

4. Additional Labor Cost resulting [from]

numerous change orders issued sporadically - - - - - - - - Php
3,303,486.60

5. Additional Overhead Cost resulting [from]

numerous Orders issued sporadically - - - - - - - - - - - - - Php
1,101,162.60

6. Interest resulting [from] payment delays

consistent with Section 7.3.b of the Original
Contract - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Php
3,442,507.50.8

On July 13, 2006, respondent sued petitioner in the Regional Trial Court
(RTC) of Marikina City (Civil Case No. 06-1122-MK) to collect the aforesaid
amounts.9 On August 17, 2006, the trial court issued a writ of preliminary
attachment.10

Petitioner denied any unpaid balance and interest due to respondent. It

asserted that the sums being claimed by respondent were not indicated in
Change Order No. 3 as approved by the Office of Provincial Governor. Also
cited was respondent’s June 10, 2003 letter absolving petitioner from liability
for any cost in connection with the Caticlan Passenger Terminal Project. 11
After trial, the trial court rendered its Decision 12 on August 14, 2009, the
dispositive portion of which reads:

WHEREFORE, foregoing premises considered, judgment is hereby rendered

in favor of plaintiff Jody King Construction And Development Corporation and
against defendant Province of Aklan, as follows:

1. ordering the defendant to pay to the plaintiff the amount of

Php7,396,143.09 representing the unpaid accomplishment on
additional works undertaken by the plaintiff;

2. ordering the defendant to refund to the plaintiff the amount of

Php884,098.59 representing additional 2% tax levied upon against the
plaintiff;

3. ordering the defendant to pay to the plaintiff price escalation in the

amount of Php1,291,714.98 pursuant to Section 7.5 of the original
contract;

4. ordering the defendant to pay to the plaintiff the amount of

Php3,303,486.60 representing additional labor cost resulting from
change orders issued by the defendant;

5. ordering the defendant to pay to the plaintiff the sum of

Php1,101,162.00 overhead cost resulting from change orders issued by
the defendant;

6. ordering the defendant to pay the sum of Php3,442,507.50

representing interest resulting from payment delays up to October 15,
2001 pursuant to Section 7.3.b of the original contract;

7. ordering the defendant to pay interest of 3% per month from unpaid

claims as of October 16, 2001 to date of actual payment pursuant to
Section 7.3.b[;]

8. ordering the [defendant] to pay to the plaintiff the sum of

Php500,000.00 as moral damages;

9. ordering the defendant to pay to the plaintiff the sum of

Php300,000.00 as exemplary damages;

10. ordering the defendant to pay the plaintiff the sum of

Php200,000.00, as and for attorney’s fees; and

11. ordering the defendant to pay the cost of suit.

SO ORDERED.13

Petitioner filed its motion for reconsideration 14 on October 9, 2009 stating
that it received a copy of the decision on September 25, 2009. In its
Order15 dated October 27, 2009, the trial court denied the motion for
reconsideration upon verification from the records that as shown by the
return card, copy of the decision was actually received by both Assistant
Provincial Prosecutor Ronaldo B. Ingente and Atty. Lee T. Manares on
September 23, 2009. Since petitioner only had until October 8, 2009 within
which to file a motion for reconsideration, its motion filed on October 9, 2009
was filed one day after the finality of the decision. The trial court further
noted that there was a deliberate attempt on both Atty. Manares and
Prosecutor Ingente to mislead the court and make it appear that their motion
for reconsideration was filed on time. Petitioner filed a
Manifestation16 reiterating the explanation set forth in its Rejoinder to
respondent’s comment/opposition and motion to dismiss that the wrong date
of receipt of the decision stated in the motion for reconsideration was due to
pure inadvertence attributable to the staff of petitioner’s counsel. It stressed
that there was no intention to mislead the trial court nor cause undue
prejudice to the case, as in fact its counsel immediately corrected the error
upon discovery by explaining the attendant circumstances in the Rejoinder
dated October 29, 2009.

On November 24, 2009, the trial court issued a writ of execution ordering
Sheriff IV Antonio E. Gamboa, Jr. to demand from petitioner the immediate
payment of ₱67,027,378.34 and tender the same to the respondent.
Consequently, Sheriff Gamboa served notices of garnishment on Land Bank
of the Philippines, Philippine National Bank and Development Bank of the
Philippines at their branches in Kalibo, Aklan for the satisfaction of the
judgment debt from the funds deposited under the account of petitioner.
Said banks, however, refused to give due course to the court order, citing the
relevant provisions of statutes, circulars and jurisprudence on the
determination of government monetary liabilities, their enforcement and
satisfaction.17

Petitioner filed in the CA a petition for certiorari with application for

temporary restraining order (TRO) and preliminary injunction assailing the
Writ of Execution dated November 24, 2009, docketed as CA-G.R. SP No.
111754.

On December 7, 2009, the trial court denied petitioner’s notice of appeal

filed on December 1, 2009. Petitioner’s motion for reconsideration of the
December 7, 2009 Order was likewise denied. 18 On May 20, 2010, petitioner
filed another petition for certiorari in the CA questioning the aforesaid orders
denying due course to its notice of appeal, docketed as CA-G.R. SP No.
114073.
By Decision dated October 18, 2010, the CA’s First Division dismissed the
petition in CA-G.R. SP No. 111754 as it found no grave abuse of discretion in
the lower court’s issuance of the writ of execution. Petitioner filed a motion
for reconsideration which was likewise denied by the CA. The CA stressed
that even assuming as true the alleged errors committed by the trial court,
these were insufficient for a ruling that grave abuse of discretion had been
committed. On the matter of execution of the trial court’s decision, the
appellate court said that it was rendered moot by respondent’s filing of a
petition before the Commission on Audit (COA).

On August 31, 2011, the CA’s Sixteenth Division rendered its Decision
dismissing the petition in CA-G.R. SP No. 114073. The CA said that petitioner
failed to provide valid justification for its failure to file a timely motion for
reconsideration; counsel’s explanation that he believed in good faith that the
August 14, 2009 Decision of the trial court was received on September 25,
2009 because it was handed to him by his personnel only on that day is not a
justifiable excuse that would warrant the relaxation of the rule on
reglementary period of appeal. The CA also held that petitioner is estopped
from invoking the doctrine of primary jurisdiction as it only raised the issue
of COA’s primary jurisdiction after its notice of appeal was denied and a writ
of execution was issued against it.

The Cases

In G.R. No. 197592, petitioner submits the following issues:

I.

WHETHER OR NOT THE DECISION DATED 14 AUGUST 2009 RENDERED

BY THE REGIONAL TRIAL COURT, BRANCH 273, MARIKINA CITY AND
THE WRIT OF EXECUTION DATED 24 NOVEMBER 2009 SHOULD BE
RENDERED VOID FOR LACK OF JURISDICTION OVER THE SUBJECT
MATTER OF THE CASE.

II.

WHETHER OR NOT THE REGIONAL TRIAL COURT, BRANCH 273,

MARIKINA CITY GRAVELY ABUSED ITS DISCRETION AMOUNTING TO
LACK OR IN EXCESS OF JURISDICTION IN RENDERING THE DECISION
DATED 14 AUGUST 2009 AND ISSUING THE WRIT OF EXECUTION
DATED 24 NOVEMBER 2009 EVEN IT FAILED TO DISPOSE ALL THE
ISSUES OF THE CASE BY NOT RESOLVING PETITIONER’S "URGENT
MOTION TO DISCHARGE EX-PARTE WRIT OF PRELIMINARY
ATTACHMENT" DATED 31 AUGUST 2006.

III.
 WHETHER OR NOT THE WRIT OF EXECUTION DATED 24 NOVEMBER
2009 WHICH WAS HASTILY ISSUED IN VIOLATION OF SUPREME COURT
ADMINISTRATIVE CIRCULAR NO. 10-2000 SHOULD BE RENDERED
VOID.19

The petition in G.R. No. 202623 sets forth the following arguments:

Petitioner is not estopped in questioning the jurisdiction of the Regional Trial

Court, Branch 273, Marikina City over the subject matter of the case.20

The petition for certiorari filed before the CA due to the RTC’s denial of
petitioner’s Notice of Appeal was in accord with jurisprudence.21

The Issues

The controversy boils down to the following issues: (1) the applicability of the
doctrine of primary jurisdiction to this case; and (2) the propriety of the
issuance of the writ of execution.

Our Ruling

The petitions are meritorious.

COA has primary jurisdiction over private respondent’s money claims

Petitioner is not estopped from raising the issue of jurisdiction

The doctrine of primary jurisdiction holds that if a case is such that its
determination requires the expertise, specialized training and knowledge of
the proper administrative bodies, relief must first be obtained in an
administrative proceeding before a remedy is supplied by the courts even if
the matter may well be within their proper jurisdiction. 22 It applies where a
claim is originally cognizable in the courts, and comes into play whenever
enforcement of the claim requires the resolution of issues which, under a
regulatory scheme, have been placed within the special competence of an
administrative agency. In such a case, the court in which the claim is sought
to be enforced may suspend the judicial process pending referral of such
issues to the administrative body for its view or, if the parties would not be
unfairly disadvantaged, dismiss the case without prejudice.23

The objective of the doctrine of primary jurisdiction is to guide the court in

determining whether it should refrain from exercising its jurisdiction until
after an administrative agency has determined some question or some
aspect of some question arising in the proceeding before the court. 24

As can be gleaned, respondent seeks to enforce a claim for sums of money

allegedly owed by petitioner, a local government unit.
Under Commonwealth Act No. 327, 25 as amended by Section 26 of
Presidential Decree No. 1445, 26 it is the COA which has primary jurisdiction
over money claims against government agencies and instrumentalities.

Section 26. General jurisdiction. The authority and powers of the Commission
shall extend to and comprehend all matters relating to auditing procedures,
systems and controls, the keeping of the general accounts of the
Government, the preservation of vouchers pertaining thereto for a period of
ten years, the examination and inspection of the books, records, and papers
relating to those accounts; and the audit and settlement of the accounts of
all persons respecting funds or property received or held by them in an
accountable capacity, as well as the examination, audit, and settlement of all
debts and claims of any sort due from or owing to the Government or any of
its subdivisions, agencies and instrumentalities. The said jurisdiction extends
to all government-owned or controlled corporations, including their
subsidiaries, and other self-governing boards, commissions, or agencies of
the Government, and as herein prescribed, including non-governmental
entities subsidized by the government, those funded by donations through
the government, those required to pay levies or government share, and
those for which the government has put up a counterpart fund or those
partly funded by the government. (Emphasis supplied.)

Pursuant to its rule-making authority conferred by the 1987

Constitution27 and existing laws, the COA promulgated the 2009 Revised
Rules of Procedure of the Commission on Audit. Rule II, Section 1 specifically
enumerated those matters falling under COA’s exclusive jurisdiction, which
include "money claims due from or owing to any government agency." Rule
VIII, Section 1 further provides:

Section 1. Original Jurisdiction - The Commission Proper shall have original

jurisdiction over:

a) money claim against the Government; b) request for concurrence in the

hiring of legal retainers by government agency; c) write off of unliquidated
cash advances and dormant accounts receivable in amounts exceeding one
million pesos (₱1,000,000.00); d) request for relief from accountability for
loses due to acts of man, i.e. theft, robbery, arson, etc, in amounts in excess
of Five Million pesos (₱5,000,000.00).

In Euro-Med Laboratories Phil., Inc. v. Province of Batangas, 28 we ruled that it

is the COA and not the RTC which has primary jurisdiction to pass upon
petitioner’s money claim against respondent local government unit. Such
jurisdiction may not be waived by the parties’ failure to argue the issue nor
active participation in the proceedings. Thus:
This case is one over which the doctrine of primary jurisdiction clearly held
sway for although petitioner’s collection suit for ₱487,662.80 was within the
jurisdiction of the RTC, the circumstances surrounding petitioner’s claim
brought it clearly within the ambit of the COA’s jurisdiction.

First, petitioner was seeking the enforcement of a claim for a certain amount
of money against a local government unit. This brought the case within the
COA’s domain to pass upon money claims against the government or any
subdivision thereof under Section 26 of the Government Auditing Code of the
Philippines:

The authority and powers of the Commission [on Audit] shall extend to and
comprehend all matters relating to x x x the examination, audit, and
settlement of all debts and claims of any sort due from or owing to the
Government or any of its subdivisions, agencies, and instrumentalities. x x x.

The scope of the COA’s authority to take cognizance of claims is

circumscribed, however, by an unbroken line of cases holding statutes of
similar import to mean only liquidated claims, or those determined or readily
determinable from vouchers, invoices, and such other papers within reach of
accounting officers. Petitioner’s claim was for a fixed amount and although
respondent took issue with the accuracy of petitioner’s summation of its
accountabilities, the amount thereof was readily determinable from the
receipts, invoices and other documents. Thus, the claim was well within the
COA’s jurisdiction under the Government Auditing Code of the Philippines.

Second, petitioner’s money claim was founded on a series of purchases for

the medical supplies of respondent’s public hospitals. Both parties agreed
that these transactions were governed by the Local Government Code
provisions on supply and property management and their implementing rules
and regulations promulgated by the COA pursuant to Section 383 of said
Code. Petitioner’s claim therefore involved compliance with applicable
auditing laws and rules on procurement. Such matters are not within the
usual area of knowledge, experience and expertise of most judges but within
the special competence of COA auditors and accountants. Thus, it was but
proper, out of fidelity to the doctrine of primary jurisdiction, for the RTC to
dismiss petitioner’s complaint.

Petitioner argues, however, that respondent could no longer question the

RTC’s jurisdiction over the matter after it had filed its answer and
participated in the subsequent proceedings. To this, we need only state that
the court may raise the issue of primary jurisdiction sua sponte and its
invocation cannot be waived by the failure of the parties to argue it as the
doctrine exists for the proper distribution of power between judicial and
administrative bodies and not for the convenience of the parties. 29 (Emphasis
supplied.)
Respondent’s collection suit being directed against a local government unit,
such money claim should have been first brought to the COA. 30 Hence, the
RTC should have suspended the proceedings and refer the filing of the claim
before the COA. Moreover, petitioner is not estopped from raising the issue
of jurisdiction even after the denial of its notice of appeal and before the CA.

There are established exceptions to the doctrine of primary jurisdiction, such

as: (a) where there is estoppel on the part of the party invoking the doctrine;
(b) where the challenged administrative act is patently illegal, amounting to
lack of jurisdiction; (c) where there is unreasonable delay or official inaction
that will irretrievably prejudice the complainant; (d) where the amount
involved is relatively small so as to make the rule impractical and
oppressive; (e) where the question involved is purely legal and will ultimately
have to be decided by the courts of justice; (f) where judicial intervention is
urgent; (g) when its application may cause great and irreparable damage; (h)
where the controverted acts violate due process; (i) when the issue of non-
exhaustion of administrative remedies has been rendered moot; (j) when
there is no other plain, speedy and adequate remedy; (k) when strong public
interest is involved; and, (l) in quo warranto proceedings. 31 However, none of
the foregoing circumstances is applicable in the present case.

The doctrine of primary jurisdiction does not warrant a court to arrogate unto
itself authority to resolve a controversy the jurisdiction over which is initially
lodged with an administrative body of special competence. 32 All the
proceedings of the court in violation of the doctrine and all orders and
decisions rendered thereby are null and void.33

Writ of Execution issued in violation of COA’s primary jurisdiction is void

Since a judgment rendered by a body or tribunal that has no jurisdiction over

the subject matter of the case is no judgment at all, it cannot be the source
of any right or the creator of any obligation. 34 All acts pursuant to it and all
claims emanating from it have no legal effect and the void judgment can
never be final and any writ of execution based on it is likewise void.35

Clearly, the CA erred in ruling that the RTC committed no grave abuse of
discretion when it ordered the execution of its judgment against petitioner
and garnishment of the latter’s funds.

In its Supplement to the Motion for Reconsideration, petitioner argued that it

is the COA and not the RTC which has original jurisdiction over money claim
against government agencies and subdivisions.1âwphi1 The CA, in denying
petitioner's motion for reconsideration, simply stated that the issue had
become moot by respondent's filing of the proper petition with the COA.
However, respondent's belated compliance with the formal requirements of
presenting its money claim before the COA did not cure the serious errors
committed by the RTC in implementing its void decision. The RTC's orders
implementing its judgment rendered without jurisdiction must be set aside
because a void judgment can never be validly executed.

Finally, the RTC should have exercised utmost caution, prudence and
judiciousness in issuing the writ of execution and notices of garnishment
against petitioner. The RTC had no authority to direct the immediate
withdrawal of any portion of the garnished funds from petitioner's depositary
banks.36 Such act violated the express directives of this Court under
Administrative Circular No. 10-2000,37 which was issued "precisely in order to
prevent the circumvention of Presidential Decree No. 1445, as well as of the
rules and procedures of the COA." 38 WHEREFORE, both petitions in G.R. Nos.
197592 and 202623 are GRANTED. The Decision dated October 18, 2010 and
Resolution dated July 5 2011 of the Court of Appeals in CA-G.R. SP No.
111754, and Decision dated August 31, 2011 and Resolution dated June 27,
2012 in CA- G.R. SP No. 114073 are hereby REVERSED and SET ASIDE. The
Decision dated August 14 2009, Writ of Execution and subsequent issuances
implementing the said decision of the Regional Trial Court of Marikina City in
Civil Case No. 06-1122-MK are all SET ASIDE. No pronouncement as to costs.

SO ORDERED.

MARTIN S. VILLARAMA, JR.

Associate Justice